Citing people familiar with the matter, the report said that China’s tech watchdog wants Didi Global’s management to remove the company from the US stock exchange over concerns of leaking sensitive data.
see photosProposals under consideration include outright privatization or a share float in Hong Kong.
Chinese regulators have asked top executives of giant Didi Global Inc to prepare a plan to delist from the New York Stock Exchange due to concerns about data security, Bloomberg News reports. The report, citing people familiar with the matter, said that China’s tech watchdog wants management to remove the company from the US exchange over concerns of leakage of sensitive data. Neither Didi nor China’s Cyberspace Administration responded to requests for comment from Reuters. Shares of Didi investors SoftBank Group Corp and Tencent Holdings fell more than 5% and 3.1%, respectively, following the report.
According to the news report, proposals under consideration include outright privatization or a share float in Hong Kong, followed by delisting from the United States. If privatization goes ahead, shareholders will be offered an initial public offering price of at least $14 per share, as a lower offering soon after June’s IPO could prompt lawsuits or shareholder resistance, the report cites sources. Has been said. As of Wednesday’s close, Didi shares have fallen 42% to $8.11 since going public in June.
According to a filing in June by Didi, the SoftBank Vision Fund holds a 21.5% stake in Didi, followed by Uber Technologies Inc. at 12.8% and Tencent at 6.8%.
Sources told Reuters that the company ran after Chinese authorities when it went ahead with its New York listing, urging the regulator to halt it while a cybersecurity review of its data practices was conducted. Soon after, the CAC launched an investigation into the collection and use of Didi’s personal data. It said the data was collected illegally and the App Store was ordered to remove 25 mobile apps operated by Didi.
Didi responded at the time by saying that it had stopped registering new users and would make changes to comply with regulations on national security and personal data use and protect users’ rights. China’s tech giant is under intense state scrutiny for its anti-monopoly behavior and its handling of vast consumer data, as the government tries to rein in its dominance after years of autocratic growth. According to a filing in June by Didi, the SoftBank Vision Fund holds a 21.5% stake in Didi, followed by Uber Technologies Inc. at 12.8% and Tencent at 6.8%.
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