Didi, the one-time billion-dollar ride-hailing app, escaped?
The WSJ reports that Didi’s nightmare in China seems to be over.
Accordingly, the Beijing government’s investigation with this ride-hailing giant has ended. This move will allow Didi to return to the app store in China, likely as soon as this week.
The information was released by the WSJ nearly a year after the company suffered the first blows from the government and its application was banned in China, causing the company’s share price to drop 53% on the New York Stock Exchange.
Didi isn’t the only company out of trouble. Two other Chinese companies listed on the US exchange, logistics provider Full Truck Alliance and online recruitment platform Kanzhun, have also come to the end of a data security investigation and will be allowed to recover. application.
Shares of these companies rose 27% and 21% in Monday’s trading. Didi, Full Truck Alliance and Kanzhun did not immediately respond to requests for comment.
The conclusion of the security investigation came too late to save Didi from a hasty exit from Wall Street just a year after its listing and would have far more consequences for the company.
The source revealed that all three companies will be fined, with the largest penalty going to Didi.
Didi is also expected to hand over a 1% stake to Chinese authorities, allowing the government to have an official role in the company’s future decisions.
The above information has ended a turbulent year for the company that was once the most valuable enterprise in China.
Didi had a pretty noisy IPO last June, raising $4.4 billion.
However, just a few days later, the Chinese authorities banned the service from appearing on the app store in China and started an investigation. The investigation led the company to the heart of a tech crackdown and forced it to stop accepting new users.
Since then, almost 90% of the company’s capitalization has been wiped out, falling from $70 billion a year ago to just $9 billion today.
Last December, Didi said it was leaving the US stock market without giving a specific reason. The move was seen as an attempt to appease Chinese authorities, who were unhappy with the company’s overseas IPO.
Earlier, Kendra Schaefer, head of technology policy at Trivium China, a consulting firm, said: “Regulators are trying to make it clear to Chinese tech companies that they can IPO at any time. where they want, as long as their ‘home’ is in China and strictly adheres to domestic laws and regulations.”
In addition, experts believe that in the coming time, China will have more control over the data these companies hold. China has moved from one of the laxest data control regimes in the world to one of the world’s most heavily regulated data regimes, starting with a cybersecurity law in 2017, tightening Beijing’s control over data flows.
Source: CNN
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