Didi Soars on Hypothesis of Favorable NYSE Delisting Phrases By Investing.com
From Dhirendra Tripathi
Investing.com – Ride-hailing giant Didi Global (NYSE 🙂 ADRs rose more than 13% in its premarket on Friday after it announced plans to delist from the New York Stock Exchange to reassure Chinese regulators .
“After careful research, the company will immediately begin delisting on the New York Stock Exchange and preparing for listing in Hong Kong,” Didi said on the microblogging site Weibo (NASDAQ :), according to Reuters.
Didi was listed on the NYSE on June 30, ignoring advice from Chinese authorities to postpone his public debut until data processing practices are reviewed. That did not go down well with regulators in China, who then called for new users to be stopped onboarding while online shops being required to remove their apps from their platforms.
For a brief period of time, Didi stock traded below its issue price of $ 14. The stock closed at $ 7.80 on Thursday.
Didi didn’t explain the rationale for the plan, but said it would hold a shareholders vote at an appropriate time and ensure that its NYSE-listed shares can be converted into negotiable shares on another exchange.
According to Reuters, Didi is preparing to relaunch its apps in China by the end of the year if he hopes the cybersecurity investigation will be completed. The authorities in China have been keeping a close eye on their online companies as many of them are listed in the US and have to share important data about their users with the regulators there, a scenario they are not comfortable with. Didi’s news comes a day after the Securities and Exchanges Commission published new rules to enforce access to data from US-listed companies.
Many Chinese ADRs have fallen sharply since signs of an impending split between the US and Chinese capital markets emerged. Companies could struggle to maintain their often high valuations without access to the world’s largest pool of capital. US investors, on the other hand, are unlikely to have easy exposure to the world’s fastest growing major economy.
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