China's Ant Financial Services Group, Alibaba Group Holding Ltd.'s Internet finance affiliate, is now valued at about $45 billion after closing a private placement from investors, according to a report by Reuters.
A source said that Ant Financial sold stakes to external investors that included China Development Bank Capital Co. and a holding company affiliated with David Yu, the co-founder of Jack Ma's private equity firm Yunfeng Capital. But the source did not disclose how much was raised.
According to the report, China's National Social Security Fund acquired about a 5-percent investment in the firm, which Ant Financial confirmed on its official Weibo microblog, adding that it reflects on the investor's faith in Ant Financial's future growth and profitability.
The source said that David Yu had previously bought shares in Ant Financial, and as his holding firm's stake increased, he and other external investors now has a 12.4-percent share of the company.
Ant Financial's increasing value may be partly attributed to Alipay, the crown jewel in Alibaba's e-commerce empire, which enables shoppers and merchants to make easy online transactions.
In addition, the Chinese government has also allowed Ant Financial to run an Internet bank and wealth management products, among other things, which is seen as a move to shake up the country's conservative finance sector and provide loan opportunities to smaller business and individual borrowers.
The Shanghai Securities News had reported in February that Ant Financial has expressed intention to raise up to $4 billion in private placement of shares.
Both Ant Financial and China Development Bank have not yet issued any statement about the recent development.