Didi Shares Fall After China Reportedly Requests NYSE Delisting
China’s Cyberspace Administration, which oversees data security, reportedly is worried about sensitive data emissions.
Didi Global (DIDI) - Get DiDi Global Inc. Report shares sank Friday, after a report that Chinese regulators have asked the ride-hailing titan to create a plan to delist from the New York Stock Exchange.
The news came from Bloomberg, which cited knowledgeable sources.
China’s Cyberspace Administration, which oversees data security, is worried about the transmission of sensitive data, the sources said. So it asked the company to set up a plan.
That could involve a privatization or listing on the Hong Kong Stock Exchange followed by a delisting from the NYSE, the sources said.
If privatization happens, shareholders will probably get back at least the $14 initial public offering price, the sources said. Otherwise, there could be major lawsuits or shareholder rebellion against the plan, they said.
A listing in Hong Kong would probably be floated at a discount to the $8.11 share price as of Wednesday’s close, Bloomberg reported. Didi recently traded at $7.70, down 5%.
In other China news Friday, Jack Ma’s Ant Group payments company is establishing a credit score company with state sponsors, the Peoples Bank of China announced Friday.
The move is part of an Ant restructuring ordered by Chinese authorities in April.
The new company will be named Qiantang Credit Reporting. Ant will have a 35% ownership stake, the central bank said, according to The Wall Street Journal.
Zhejiang Tourism Investment Group, which is controlled by the Zhejiang provincial government, also gets 35%. Two Ant executives will have a 10% stake, and the rest goes to Zhejiang-based companies.
Ma, of course, is the founder of e-commerce titan Alibaba BABA.