fbpx

Type to search

China Regulators Seen Pushing Didi To Delist In US


Notice: Undefined index: imp_points in /var/www/asiafinancialcom/wp-content/themes/atf/single.php on line 130

Beijing is pressuring the ride-hailing firm to ditch the NYSE over data security fears, it’s claimed, ahead of a China bourse relaunch


An NYSE trader works on the Didi IPO in New York last July.
Didi shares shot up 50% today after a report that Chinese regulators plan to allow the company's apps to go back on domestic app stores. File photo: Reuters.

 

Ride-hailing giant Didi is being pushed by Beijing to delist from the New York Stock Exchange over concerns about data security, two sources said.

China’s powerful Cyberspace Administration of China (CAC) is pressing the firm’s management to take the company off the US bourse sooner rather than later, the sources said, before it will allow the relaunch of Didi’s ride-hailing and other apps in China.

Proposals under consideration include a straight-up privatisation or a second listing in Hong Kong followed by a delisting from the United States, said one of the sources.

In July, the CAC ordered app stores to remove 25 mobile apps operated by Didi – just days after the company listed in New York. It also told Didi to stop registering new users, citing national security and the public interest.

 

Also on AF: Most Crypto Trades Were People Buying From Themselves: Study

 

Reuters reported earlier this month that Didi is preparing to relaunch its apps in the country by the end of the year in anticipation that Beijing’s cybersecurity investigation into the company would be wrapped up by then, citing sources directly involved in the relaunch.

SoftBank Vision Fund owns 21.5% of Didi, followed by Uber Technologies Inc with 12.8% and Tencent’s 6.8%, according to a filing in June by Didi. As of Thursday’s close, Didi’s shares had fallen 42% to $8.11 since it went public in June.

The company ran foul of Chinese authorities when it pressed ahead with its New York listing, despite the regulator urging it to put it on hold while a cybersecurity review of its data practices was conducted, sources said.

 

CAC Didi Investigation

Soon after, the CAC launched an investigation into Didi over its collection and use of personal data. It said data had been collected illegally. 

Didi responded at the time by saying it had stopped registering new users and would make changes to comply with rules on national security and personal data usage and would protect users’ rights.

China’s tech giants are under intense state scrutiny over anti-monopolistic behaviour and handling of their vast consumer data, as the government tries to rein in their dominance after years of unfettered growth.

 

  • Reuters with additional editing by Sean O’Meara

 

Read more:

Didi Seen Relaunching China Apps on End to Regulatory Probe

How Didi Misread China’s Changing Regulatory Environment

 

Tags:

Sean O'Meara

Sean O'Meara is an Editor at Asia Financial. He has been a newspaper man for more than 30 years, working at local, regional and national titles in the UK as a writer, sub-editor, page designer and print editor. A football, cricket and rugby fan, he has a particular interest in sports finance.

logo

AF China Bond