Didi prepares US delisting, Hong Kong share debut

Published: 11:18, December 03, 2021
| Updated: 11:45, December 03, 2021

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Didi prepares US delisting, Hong Kong share debut

By Bloomberg

Published:11:18, December 03, 2021
Updated:11:45, December 03, 2021
By Bloomberg

A pedestrian stands behind a logo at the Didi Global Inc offices in Hangzhou, China, August 2, 2021. (QILAI SHEN / BLOOMBERG)

Didi Global Inc has begun preparations to withdraw from US stock exchanges and will start work on a Hong Kong share sale.

The ride-hailing giant’s board has authorized the company to file for a delisting of its American depositary shares from the New York Stock Exchange and will pursue a listing in Hong Kong, it said in a statement Thursday. 

It will ensure that the US stock will be convertible into freely tradable shares on another internationally recognized stock exchange, according to the statement. 

Chinese regulators had asked Didi’s top executives to devise a plan to delist from US bourses because of concerns about leakage of sensitive data, Bloomberg reported last week. 

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The ride-hailing giant 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. Regulators placed the company under a cybersecurity review days after its debut, and has since asked Didi to work on plans for a withdrawal from the NYSE. 

Didi shares were little changed at $7.80 on Thursday, having tumbled nearly 45 percent from their IPO price. 

Executives had considered proposals including a straight-up privatization or a share float in Hong Kong followed by a delisting from the US, people with knowledge of the matter told Bloomberg.

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If the privatization proceeds, the proposal will likely be at least the $14 IPO price since a lower offer so soon after the June initial public offering could prompt lawsuits or shareholder resistance, the people had said. If there is a secondary listing in Hong Kong, the IPO price would probably be a discount to the share price in the US.