(Yicai Global) July 10 -- Alibaba Group Holding’s stock rose in Hong Kong after the e-commerce titan said it is considering selling shares back to Ant Group as part of the financial technology giant’s CNY43.1 billion (USD6 billion) repurchase program.

Alibaba [HKG: 9988] ended 3.2 percent higher at HKD87 (USD11.11) today, after opening up 5.6 percent. In pre-market trading in New York, the firm’s stock [NYSE: BABA] was 1.5 percent down at USD89.20 as of 4.23 a.m. local time.

In a filing to the Hong Kong Stock Exchange yesterday, Alibaba said it was mulling selling shares back to Ant, which announced the plans the day before in the wake of a CNY7.12 billion (USD985 million) fine from Chinese regulators last week. Hangzhou-based Alibaba spun off Ant 11 years ago.

Ant proposes to repurchase 7.6 percent of its own equity, with the aim of supplementing its employee incentive program and freeing up liquidity for investors, it added.

The buyback values Ant at around CNY567.1 billion, which is about 73 percent less than its CNY2.1 trillion (USD290.9 billion) valuation in 2020 before the firm’s initial public offering was scrapped by China’s financial regulators. Analysts believe the latest valuation is in line with expectations for Chinese internet firms.

Alibaba founder Jack Ma, Chief Human Resources Officer Peng Lei, and Chairman Daniel Zhang, as well as Ant Chairman Jing Xiandong and the other individual shareholders who own Ant equity through Hangzhou Junhan Equity Investment and Hangzhou Junao Equity Investment, are committed to the fintech company’s long-term development and will not join in the share buyback plan, Ant noted. Junhan and Junao own over 76 percent of Ant.

On July 7, Chinese regulators, including the People’s Bank of China and the China Securities Regulatory Commission, fined Ant and its units for violating laws and regulations on corporate governance, financial consumer protection, anti-money laundering obligations, and others. The fine ends a years-long regulatory crackdown on the internet finance sector.

Ant has finished rectifying its platform, and the regulatory focus will now switch to normal supervision, the CSRC noted. Ant’s applications to set up financial holding companies and credit investigation business licenses may now accelerate, according to analysts.

Editor: Futura Costaglione