China’s Didi bows to regulatory pressure for US delisting

Just five months after its debut, ride-hailing giant Didi Global (DIDI.N) said it plans to withdraw from the New York stock exchange and pursue a Hong Kong listing, a stunning volte-face as it bends to Chinese regulators angered by its US IPO.

Its shares plunged 9 per cent in premarket trading, after initially soaring 15 per cent as investors bet the move would appease Beijing and serve as a catalyst for a revival of its business prospects at home.

"Following careful research, the company will immediately start delisting on the New York stock exchange and start preparations for listing in Hong Kong," Didi said on its Twitter-like Weibo account on Friday.

Didi did not explain its reasons for the plan but said in a separate statement it would organise a shareholder vote at an appropriate time and ensure its New York-listed stock would be convertible into "freely tradable shares" on another internationally recognised stock exchange.

Sources told Reuters last month that Chinese regulators had pressed Didi's top executives to devise a plan to delist from the New York Stock Exchange due to concerns about data security.

Didi pushed ahead with a $4.4 billion US initial public offering in June despite being asked to put it on hold while a review of its data practices was conducted.

The powerful Cyberspace Administration of China (CAC) then quickly ordered app stores to remove 25 of Didi's mobile apps and told the company to stop registering new users, citing national security and the public interest.