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World China ride-hailing giant denies plans to go private

10:36  30 july  2021
10:36  30 july  2021 Source:   bbc.com

Didi shares fall on reports of penalties in China

  Didi shares fall on reports of penalties in China The ride-hailing giant's shares are now down by more than 25% since their New York market debut last month.It comes after a report that regulators in Beijing are considering serious penalties for the company.

Chinese ride-hailing giant Didi has denied a report that it was considering going private to appease Chinese authorities.

a person driving a car: Since making its US market debut a month ago the company has been targeted by authorities in Beijing © Getty Images Since making its US market debut a month ago the company has been targeted by authorities in Beijing

Its shares had soared by almost 50% in Thursday's pre-market trade after the Wall Street Journal report.

Since making its US market debut a month ago the company has been targeted by authorities in Beijing.

Meanwhile, some US senators have called on its financial markets regulator to investigate Chinese share listings.

"The rumors about the privatization of Didi are untrue, and the company is currently actively cooperating with cybersecurity reviews," the company said on Chinese social media platform Weibo.

US-China talks come at time of heightened tension

  US-China talks come at time of heightened tension US diplomatic trip comes 50 years after Kissinger’s secret China visit initiating relations between the two countries.Last Monday, US President Joe Biden – along with NATO, the European Union, Australia, the UK, Canada, Japan and New Zealand – slammed China for a wide-reaching cyberespionage campaign, which Secretary of State Antony Blinken said posed “a major threat to our economic and national security”.

The statement came in response to a Wall Street Journal report, which cited people familiar with the matter as saying Didi was considering delisting its share in the US as it faced increasing pressure from regulators in China.


Video: China's Big Tech crackdown is attempt to keep IPOs closer to home: Pro (CNBC)

Two days after Didi shares started trading on the New York Stock Exchange, China's internet regulator ordered online stores not to offer its app, saying it illegally collected users' personal data.

That sent the company's market value down sharply and it has now fallen by around a third since Didi raised $4.4bn (£3.15bn) in its initial public offering (IPO) a month ago.

On Thursday, a group of Republican senators called on the country's financial markets regulator to launch an inquiry into US-listed Chinese companies.

In the letter to the head of Securities and Exchanges Commission the seven lawmakers cited losses sustained by Didi investors after Beijing's took action against the company.

In recent months Chinese technology companies traded in the US, Hong Kong and mainland China have seen their share prices slump as Beijing tightens its grip on the industry.

Just this week authorities have cracked down on a range of online services from food delivery apps to music streaming platforms.

Didi shares ended Thursday's US trading day up by 11.3%.

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This is interesting!