The story lasted less than a year. The complex relationship between Didi and the New York Stock Exchange is coming to an end. The Chinese mobility company has announcement on May 23 that its shareholders voted 96% in favor of leaving the market. A file will be filed to this effect with the policeman of the American stock market, the SEC, around June 2. Trading in the shares is expected to stop in the following days.
Didi’s crazy adventure on the New York Stock Exchange
Since joining Wall Street in June 2021, Didi’s stock market value has fallen 90%, a loss of $70 billion. Within days of the operation, the Cyberspace Administration of China (CAC) launched an investigation into the company’s data security.
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This investigation is still ongoing, but has had several major consequences for Didi. Several of its services were suspended, its overseas expansion was brought to a halt, and it was banned from recruiting new users.
The company has found itself caught in the middle of a dispute between the United States and China over auditing standards for listed companies. Beijing prohibits its companies from transmitting data deemed sensitive to Americans. The Securities and Exchange Commission has imposed more comprehensive audits within 3 years, with inspection of their agents.
A hundred Chinese companies present on Wall Street are threatened with exclusion. Didi served as a symbol of this conflict. the wall street journal reports, however, that Beijing claimed that Didi decided to leave New York on her own. Negotiations are also underway to resolve these difficulties.
The future is in Hong Kong
As early as December 2021, Didi announced that she intended to leave New York. The company said it wanted to wait for the CAC’s investigations to be completed before going public in Hong Kong.
In the meantime, some investors will have to sell their Didi shares, having no mandate to hold unlisted shares. Bloomberg notes that hedge funds reduced their Didi holdings by 29% in the first quarter of 2022. Some of the company’s main shareholders, SoftBank, Tencent, Uber, Blackrock or Fidelity Investments, which do not have this type of difficulty, could decide not to wait for Didi’s return to the markets.