China Cinda Asset Management Co Ltd scrapped a deal to buy a 20per cent stake worth about $944 million in fintech giant Ant Group's consumer finance arm because of pressure from state authorities, people with knowledge of the matter said.
Cinda's crucial capital injection into Ant was endorsed by its primary regulator - the China Banking and Insurance Regulatory Commission - but it failed to secure approval from higher government authorities, said two sources with direct knowledge of the matter. Cinda on Monday declined to elaborate beyond its Thursday statement announcing the pullback, in which it said the decision came after prudent commercial consideration and negotiation with Ant's consumer finance unit.Last week, the company said it respected the"business decision" of Cinda and that it would"ensure the rectification work" for the consumer finance unit was carried out.