(Bloomberg) — DiDi Global Inc. collapsed on Monday, after the Chinese private transport giant said it plans to withdraw its US-listed shares before it found a new place for shares.
DiDi's ADRs plummeted 18% to $2.01 after convening an extraordinary general meeting on May 23 to vote on the exclusion of its shares from the New York Stock Exchange. While the company will continue to explore listing on another internationally recognized exchange, DiDi said it will not apply until the US listing exclusion ends.
“While investors knew full well that DiDi Global intended to go public in the US, the way it did so took investors by surprise,” said Gary Dugan, executive director of The Global CIO Office.
Separately, DiDi reported that its fourth quarter net loss fell by 95% compared to a year ago despite a 13% decline in revenue to 40.78 billion yuan.
DiDi has plummeted 86% since it went public, eliminating $58 billion in market value. The company was one of the main targets of Beijing's private sector crackdown last year, as regulators launched a cybersecurity investigation just days after its IPO and forced its services to leave domestic app stores. It was later said that the Beijing agency responsible for data security had asked senior DiDi executives to design a plan to stop listing due to concerns that sensitive data could be leaked.
The Chinese Securities and Regulatory Commission said in a statement on Saturday that Didi's case would not affect talks with the US on access to audit. Investors remained optimistic after Beijing regulators amended a rule that restricted the exchange of financial data by foreign-listed companies. The move could help US regulators gain full access to the audit reports of most of the more than 200 Chinese companies listed in New York.
The lack of an immediate plan to re-enter the stock exchange dealt another blow to DiDi's shareholders if they expected to convert their US-listed shares into Hong Kong shares before Didi's withdrawal from the New York Stock Exchange. It also added to investors' nervousness about the company's way forward, with concerns about further sanctions from regulators.
Original Note:
DiDi Global Sinks on Delisting Plans and Revenue Drop (1)
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