Didi US debut overshadowed by China cybersecurity probe

BEIJING: China’s cyberspace regulator has announced a cybersecurity investigation into Chinese ride-hailing giant Didi Global and ordered that Chinese app stores halt downloads of its app, days after the company’s US initial public offering.

Following are key events in Didi’s IPO:

Oct 20, 2020 – Didi is considering Hong Kong for an IPO in 2021, Reuters reports, dropping previous aims to list in New York amid rising Sino-U.S. tensions, with a target valuation of more than US$60 billion.

Mar 24, 2021 – Didi leans towards New York over Hong Kong for its IPO, eyeing a valuation of at least US$100 billion, two people with direct knowledge of the matter say.

Apr 9 – Didi has mandated Goldman Sachs and Morgan Stanley to lead its IPO and plans to file confidentially for the New York float during April, Reuters reports.

Jun 11 – Didi makes public the filing for its U.S. listing, setting the stage for what is expected to be the world’s biggest initial public offering of 2021.

Jun 17 – Reuters reports that China’s market regulator has begun an antitrust probe into Didi, citing three people with knowledge of the matter.

The probe, the latest in a sweeping crackdown on China’s so-called “platform” companies, is investigating whether Didi used any competitive practices that squeezed out smaller rivals unfairly, and whether the pricing mechanism used by Didi’s core ride-hailing business is transparent enough, sources say.

“We do not comment on unsubstantiated speculation from unnamed source(s),” Didi says.

Jun 24 – Didi’s US$4 billion IPO has enough investor demand for its targeted price range, people familiar with the matter say, implying a US$62.4-US$67.2 billion valuation.

Jun 28 – Didi will close the investor order books for its IPO one day early on June 28, two people with direct knowledge of the matter say.

Jun 29 – Didi will price its IPO shares at the top of the indicated range or above, Reuters reports, citing a source with direct knowledge of the matter.

Jun 30 – Didi raises US$4.4 billion in its IPO, pricing it at the top of its indicated range and increasing the number of shares sold, giving it a valuation of US$73 billion on a fully diluted basis and US$67.5 billion on a non-diluted basis.

The shares end their first day of trading slightly above IPO price.

Jul 2: The Cyberspace Administration of China (CAC) says it has launched an investigation into Didi to protect national security and the public interest, and that Didi was not allowed to register new users during the probe, sending Didi shares lower.

Didi says it plans a comprehensive examination of cybersecurity risks and would cooperate fully with the relevant government authority.

Jul 4 – The CAC orders Chinese app stores to stop offering Didi’s app after finding that the firm had illegally collected users’ personal data.

Didi says it had stopped registering new users and would remove its app from app stores, and would make changes to comply with rules and protect users’ rights. It says the move may hurt its revenue.

Jul 5 – The CAC announces cybersecurity investigations into online recruiting company Zhipin.com and truck-hailing companies Huochebang and Yunmanman, which have merged to form Full Truck Alliance. Zhipin.com’s owner Kanzhun Ltd and Full Truck Alliance went public in US listings last month.

Didi says that it was unaware before its IPO that the CAC would launch a cybersecurity investigation or order a halt in China to new user registrations and a suspension of app downloads.

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