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Didi’s US Delisting Plan May Have Lost Hedge Funds $57m

China’s Didi Global has seen a 7.9% fall in its shares since the end of September and that will have hurt the institutional investors holding 27% of the company

Didi Global said on Monday it will be allowed to register new users, but no timeline was given.
Didi's Andi joint venture was set up last year.


Ride-hailing giant Didi’s decision to delist from the New York Stock Exchange could have helped wipe $57 million off the positions of hedge funds who’ve invested in the Chinese firm.

Didi’s shares have tumbled 56.8% from their June 30 IPO price. The slide accelerated after the company said on Friday it planned to delist from the New York Stock Exchange and pursue a listing in Hong Kong, bending to Chinese regulators angered by its US debut.

Hedge funds were invested in 94.4 million shares of Didi at the end of September, down 13.2 million shares from the previous quarter, according to US 13F filings compiled by industry tracker Symmetric.

It is not known if hedge funds had further reduced their investment since that time, but calculations show the 7.7% fall in Didi’s shares between  December 2 and December 7 would have wiped a combined $57 million of value from those positions.


Also on AF: Chinese Stocks Delisting From the US: 25 On the Brink


As of the end of September, 27% of the value of the company was held by institutional investors owned by managers classified as hedge funds by Symmetric.

Symmetric notes that stocks with a high percentage of ownership by hedge funds may be susceptible to liquidations by those funds during stressed periods.

Among hedge funds that bought shares in the third quarter, Bridgewater Associates purchased almost 9 million, according to filings.

Penserra Capital bought 5.4 million in Didi’s stock while Owl Creek Asset Management purchased 1.7 million and Seven Eight Capital 537,145 shares, the filings showed. They showed that Paulson & Co added 1.6 million shares at the end of the third quarter while Seven Eight Capital purchased 537,145 shares. 

Tiger Global Management and billionaire George Soros’ fund also held sizeable stakes in Didi at the end of the third quarter, together accounting for 4.7 million shares at end-September.


Hong Kong Shares Dilemma

Singapore’s state fund Temasek reduced its position in Didi by 3.6 million shares as of September 30, but maintained a stake of 29.4 million shares.

It is not known if these firms are still invested but an executive at a large US based hedge fund, which had a small position in Didi that it exited recently, said a lot of people are pulling out even if they plan to possibly get back in later.

“There is also a problem that retail investors and even some mutual funds may not be able to easily own Hong Kong listed shares and will be forced to sell, so there would be more pressure,” said the executive.

Among the public pension plans that held shares of Didi were Canada Pension Plan (CPP), Montreal-based Caisse de dépôt et placement du Québec and the California Public Employees’ Retirement System (CalPERS).


  • Reuters with additional editing by Sean O’Meara


Read more:

‘Death Knell’ for China Stocks in US as Didi Plunges

Didi to Delist From US for Hong Kong Following Tech Crackdown


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.


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