1st Ld-Writethru: China Focus: Ant Financial raises 4.5 bln dollars in latest financing round

Alibaba's financial affiliate Ant Financial said on Tuesday that it has completed a 4.5-billion-dollar financing round that valued the company at 60 billion U.S. dollars.

The investment, which Ant Financial said is the most ever raised by an Internet company in a single round, was led by China Investment Corporation Capital and CCB Trust, a subsidiary of state-owned lender China Construction Bank.

Ant Financial's early backers such as China Life Insurance Group, China Post Group, China Development Bank Capital and Primavera Capital also participated in the latest round.

Ant Financial's new valuation of 60 billion dollars has exceeded that of Uber, which was recognized last year as the world's most valuable start-up, at 51 billion dollars.

Ant Financial owns China's largest third-party payment service Alipay and controls the company that manages the country's largest money market fund, Yu'ebao. Its businesses also include consumer credit and the private lender MYbank.

Though many of Ant Financial's services are emerging as more popular alternatives to traditional bank offerings such as deposits, loans and wealth management products, it has worked closely with state-backed investors to expand its influence in China's state-dominated and tightly regulated financial sector.

In China, Alipay holds 68.4 percent of the country's 35.4-trillion-yuan mobile payment market. Its rival, Tenpay, operated by Chinese Internet company Tencent, comes in second place at 20.6 percent, according to consultancy iResearch.

Alibaba's smaller e-commerce rival JD.com has also raised funds for its own financial subsidiary JD Finance, now valued roughly at 7 billion dollars, to expand consumer credit and other financial offerings.

The funds Ant Financial raised will be used to expand financial services in rural China, ramp up investment in financial services in other countries, strengthen tech and risk control, and green finance, the company said.

About 140 million Alipay users are from rural China. Ant Financial said they can enjoy the same financial services as their urban peers through Alipay mobile wallet.

Ant Financial also plans to use the funds to sharpen its competitiveness in financial technology ranging from cloud computing to biometric identification.

Ant Financial and its rivals have long argued that their data mining and innovative identification methods could become more cost-effective alternatives to credit assessments used by traditional lenders. Such financial technology, they said, could also help extend financial services to smaller firms and individuals previously underserved by large banks due to a lack of credit history.

The newly raised funds will also help Ant Financial expand into the international market. Its overseas strategy has been focused on leveraging its financial technology to improve transaction efficiency and risk control for other similar mobile financial service providers.

It has credited its own financial technology for elevating the popularity of Indian mobile payment platform Paytm, which has received funding from Ant Financial. K-bank, an Ant Financial-backed online lender in the Republic of Korea, is also getting ready to open for business.

Peng Yijie, an executive who runs Ant Financial's overseas business, said at a conference in Copenhagen that 30 percent of its users will come from outside China in the next three years. Endi