Ride-hailing giant Didi will delist from the New York Stock Exchange

The move came after the company clashed with the Chinese authorities in July to advance its $4.4 billion US IPO.

Ride-hailing giant Didi Global said on Friday that it would succumb to pressure from Chinese regulators on data security to delist from the New York Stock Exchange and seek a Hong Kong listing.

It ran Conflict with Chinese authorities Although it was asked to shelve it during the review of its data practices, it continued to advance its $4.4 billion US IPO in July.

The powerful National Cyberspace Administration of China quickly ordered the app store to remove 25 mobile apps operated by Didi on the grounds of national security and public interest, and asked Didi to stop registering new users. Didi is still investigating.

“After careful study, the company will immediately begin delisting on the New York Stock Exchange and begin preparing to list in Hong Kong,” Didi said on its Twitter-like Weibo account.

It later stated in another English statement that its board of directors had approved the move.

“The company will organize a general meeting of shareholders to vote on the above matters at an appropriate time in the future, in accordance with necessary procedures,” it said.

Didi debuts in New York in June [Brendan McDermid/Reuters]

Sources told Reuters that out of concerns about data security, Chinese regulators pressured Didi executives to formulate a plan to delist from the New York Stock Exchange.

Kenny Ng, a securities strategist at Everbright Sun Hung Kai in Hong Kong, said: “Didi’s plans to delist in the United States and go public on Hong Kong stocks, I think will have a significant impact on the site selection decisions of large technology stocks in the future.”

“At the same time, this incident has convinced the market that the current mainland China’s industry supervision of technology stocks will continue, and the decline in the stock prices of technology stocks listed in Hong Kong today also reflects this factor.”

Sources told Reuters that Didi is preparing to relaunch its app in China by the end of the year, and it is expected that Beijing’s cybersecurity investigation of the company will be concluded by then.

CAC did not immediately respond to a request for comment on Didi’s plan to delist from New York.

Didi made its debut in New York on June 30 at a price of $14 per American depositary stock, which puts the company at a valuation of $67.5 billion on an undiluted basis. Since then, these stocks have fallen 44% before the close on Thursday and are valued at $37.6 billion.

After Didi announced the news, the share price of Didi investor Softbank Group fell by more than 2%, which was also affected by the plunge of Southeast Asian ride-hailing giant Grab on the first day of its NASDAQ listing.

According to a document submitted by Didi in June this year, SoftBank’s Vision Fund holds a 21.5% stake in Didi, followed by Uber with 12.8%.

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