Chinese regulators have asked Didi Global Inc’s (滴滴) top executives to devise a plan to delist from US bourses, people familiar with the matter said, an unprecedented request that is likely to revive fears about Beijing’s intentions for its tech industry.
The country’s tech watchdog wants management to take the company off the New York Stock Exchange because of concerns about leakage of sensitive data, the people said, asking not to be identified discussing a sensitive matter.
The Cyberspace Administration of China, the agency responsible for data security in the country, has directed Didi to work out precise details, subject to government approval, they said.
Photo: AFP
Proposals under consideration include a straight-up privatization or a share float in Hong Kong followed by a delisting from the US, the people said.
If the privatization proceeds, the proposal is likely to be at least the US$14 debut price, as a lower offer so soon after the June initial public offering (IPO) could prompt lawsuits or shareholder resistance, the people said.
If there is a secondary listing in Hong Kong, the IPO price would probably be a discount to the share price of US$8.11 as of Wednesday’s close in New York.
Deliberations continue and it is possible that regulators will backtrack on their request, the people said.
Either option would deal a severe blow to a ride-hailing giant that pulled off the largest US debut by a Chinese firm since Alibaba Group Holding Ltd’s in 2014.
Didi sparked the ire of Beijing when it proceeded with its New York stock offering this summer, despite regulatory requests that it ensure the security of its data before the IPO.
Chinese regulators quickly launched multiple investigations into the company and have considered a range of unprecedented penalties, Bloomberg News reported in July.
It is possible that the delisting would be part of a package of punishments for Didi.
Beijing’s municipal government has proposed an investment in the company that would give state-run firms effective control, Bloomberg News reported in September.
Such an investment could help Didi finance the repurchase of its US-traded shares.
Didi is controlled by the management team of cofounder Will Cheng (程維) and company president Jean Liu (柳青), which received aggregate voting power of 58 percent after the company’s US IPO.
Softbank and Uber Technologies Inc are Didi’s biggest minority shareholders.
Even if Didi shifts its listing to Hong Kong, it will have to address the data security concerns that have drawn scrutiny from regulators.
The company might have to give up control of its data to a third party — again undercutting its price tag.
A withdrawal from US bourses could stoke fears of an exodus of Chinese firms as Washington and Beijing quarrel about access to listed firms’ books.
On Thursday, a senior Chinese regulatory official said such delistings would be a setback for relations with the US, while offering broad support for Hong Kong as an alternative venue.
Didi — once feted for defeating Uber in China — has now become a test case for a broader Chinese government effort to curb the power of Internet titans.
The domestic unit of the Chinese-owned, Dutch-headquartered chipmaker Nexperia BV will soon be able to produce semiconductors locally within China, according to two company sources. Nexperia is at the center of a global tug-of-war over critical semiconductor technology, with a Dutch court in February ordering a probe into alleged mismanagement at the company. The geopolitical tussle has disrupted supply chains, with some carmakers reportedly forced to cut production due to chip shortages. Local production would allow Nexperia’s domestic arm, Nexperia Semiconductors (China) Ltd (安世半導體中國), to bypass restrictions in place since October on the supply of silicon wafers — etched with tiny components to
Singapore-based ride-hailing and delivery giant Grab Holdings Ltd has applied for regulatory approval to acquire the Taiwan operations of Germany-based Delivery Hero SE's Foodpanda in a deal valued at about US$600 million. Grab submitted the filing to the Fair Trade Commission on Friday last week, with the transaction subject to regulatory review and approval, the company said in a statement yesterday. Its independent governance structure would help foster a healthy and competitive market in Taiwan if the deal is approved, Grab said. Grab, which is listed on the NASDAQ, said in the filing that US-based Uber Technologies Inc holds about 13 percent of
Taiwan is open to joining a global liquefied natural gas (LNG) program if one is created, but on the condition that countries provide delivery even in a scenario where there is a conflict with China, an energy department official said yesterday. While Taiwan’s priority is to have enough LNG at home, the nation is open to exploring potential strategic reserves in other countries such as Japan or South Korea, Energy Administration Deputy Director-General Chen Chung-hsien (陳崇憲) said. While the LNG market does not have a global reserve for emergencies like that of oil, the concept has been raised a few times —
Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) yesterday received government approval to deploy its advanced 3-nanometer (3nm) process at its second fab currently under construction in Japan, the Ministry of Economic Affairs said in a news release. The ministry green-lit the plan for the facility in Kumamoto, which is scheduled to start installing equipment and come online in 2028 with a monthly production capacity of 15,000 12-inch wafers, the ministry said. The Department of Investment Review in June 2024 authorized a US$5.26 billion investment for the facility, slated to manufacture 6- to 12nm chips, significantly less advanced than 3nm process. At a meeting with
RSS