Understanding why Alipay is said to have no actual controller in 1 minute - Huxiu#
Recently, there has been big news about Alipay, as the central bank has agreed to change Alipay to have no actual controller.
As a third-party payment company, Alipay is subject to daily supervision by the central bank.
In actual life, there are quite a few companies without actual controllers that still operate well. This change in Alipay does not affect the normal operation of the company.
Simply put, Alipay no longer has an individual who can have a decisive impact on the company's operations and decisions.
Generally speaking, the more shares a company has, the greater the voting rights, and the greater the control over the company.
The so-called actual controller is a person who has a larger voting right and can actually control the company's actions through investment relationships, agreements, or other arrangements.
Among them, investment relationships mainly refer to holding equity, such as directly holding equity or investing through fund companies.
Agreements mainly refer to controlling the company through entrusted holding agreements, investment agreements, etc.
The so-called entrusted holding refers to not directly holding equity, but through signing agreements to find institutions or individuals to hold equity on behalf of oneself.
And other arrangements generally refer to relatives holding shares, employees holding shares, and so on.
Through these methods, the actual controller becomes the person who has the actual control over the company.
Here we add another concept, called concerted action person. Simply put, it refers to a person who takes concerted action for common interests.
In order to act in concert externally, when the voting rights of a shareholder are not enough, it is necessary to gather multiple shareholders to reach a unanimous decision.
At this time, the concerted action person concentrates the voting rights to individual shareholders by transferring the voting rights, thereby expanding the control of the shareholder over the company's equity, which can improve decision-making efficiency or counteract the control of other shareholders over the company.
For listed companies, concerted action person refers to investors who, through agreements or other arrangements, jointly expand the number of voting rights of a listed company's shares that they can control.
Understanding these basic concepts, why was it said that Alipay originally had an actual controller?
The original equity structure of Alipay was roughly like this:
As can be seen, at this time, Jack Ma, through concerted action agreements, had 53.46% of the voting rights of Ant Group and became the actual controller of Ant Group, while Alipay was controlled by Ant Group through full ownership.
So what kind of company is considered to have no actual controller?
The equity structure is dispersed, and there is no controlling shareholder holding more than 50% of the shares.
There is no situation where the actual control of the company's voting rights exceeds 30%.
There is no concerted action agreement among shareholders.
A single shareholder cannot control the shareholders' meeting, or a single director cannot control the board of directors;
A single director or senior executive cannot control major financial and operational decisions of the company.
After this equity adjustment, let's see what changes have occurred in the equity structure of Alipay:
After the adjustment, Jack Ma's voting rights have dropped to 6.208%, and the major shareholders independently exercise the voting rights of Ant Group shares without any concerted action relationship.
At this point, there is no longer any direct or indirect shareholder, single or joint control of Ant Group, and Alipay no longer has an actual controller.
With relatively dispersed voting rights, better checks and balances can be achieved, preventing a single dominant force, and corporate governance is more stable and transparent. This is a more modern corporate governance model.
In summary, Ant Group has improved its corporate governance structure, which is conducive to the long-term and sustainable development of the company.
So, is Ant Group's listing back on the agenda?
Well, let's stop here for today.
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