Chinese ride-hailing giant Didi Chuxing said on its Weibo account on Friday that, after careful study, the company will start the delisting process from the NYSE and plan its listing in Hong Kong. The move comes after five months after the company was slapped with a cybersecurity review by China’s cyberspace regulator.
According to some media reports, some apps owned by Didi Chuxing have been put on shelves in Apple’s Chinese App Store, including Didi Jiayou and DiDi-Rider.
The US Securities and Exchange Commission (SEC) on Thursday announced that Chinese companies that list on U.S. stock exchanges must disclose whether they are owned or controlled by a government entity while also giving evidence of their auditing inspections. Didi Chuxing is the first Chinese company to announce its U.S. delisting after the SEC announced the new regulations.
The delisting announcement came only five months after Didi went public in the United States. On June 30th this year, Didi quietly listed on the NYSE with the ticker symbol “DIDI”. Didi’s issue price was set at $14 and on the first day of listing alone, Didi’s market value soared to $80 billion USD.
Didi Chuxing’s stock price was $7.8 per share on Friday and its market value dropping to $37.621 billion.
On July 2nd, Chinese cybersecurity authorities announced that it would launch a network security review for Didi Chuxing as China stepped up efforts to safeguard national data security risks. During the review period, Didi Chuxing’s app stopped new user registration.
On July 4th, Didi was asked to be removed from the App Store and examined for “the serious illegal collection and use of personal information”. On July 9th, the Network Information Office issued a notice again. Due to the problem of collecting and using personal information in violation of laws and regulations, 25 apps under Didi’s company were required to be removed from the shelves. The apps covered hitchhiking, substitute driving, finance, freight transportation, distribution, public transportation and other fields.
After Didi Chuxing came under review, the online car-hailing market welcomed many new players. Meituan restarted its taxi business. Later, more than 200 second-line online car-hailing companies, such as Caocao Mobility and T3 Travel, strengthened their promotion efforts and invested in a lot of subsidies in both drivers and passengers. In July, data released by the Ministry of Transportation showed that there were 17 online car-hailing platforms with domestic orders exceeding 300,000 orders.
On November 30th, the Ministry of Transportation and another eight departments jointly issued a document that set forth rules for the development of the online car-hailing industry. In order to maintain fair competition and ensure the rights and interests of both drivers and passengers, the document called for the strengthening of supervision for enterprises and stronger warnings for monopolistic behavior in the industry.