China asks Didi to delist from US on security fears: Report

 

SHANGHAI: Chinese regulators have asked top executives of ride hailing giant Didi Global to devise a plan to delist from US bourses on data security fears, Bloomberg News reported.

China's tech watchdog wants the management to take the company off the New York Stock Exchange on concerns about leakage of sensitive data, the report said, citing people familiar with the matter.

Didi and the Cyberspace Administration of China (CAC) did not respond to Reuters requests for a comment. Shares in SoftBank Group Corp, which has a minority stake in Didi, fell more than 5 per cent.

Proposals under consideration include a straight up privatisation or a share float in Hong Kong followed by a delisting from the United States, according to the news report.

If the privatisation proceeds, shareholders would likely be offered at least the US$14 per share initial public offering (IPO) price, since a lower offer so soon after the June IPO could prompt lawsuits or shareholder resistance, the report said, citing sources. 

Didi ran afoul of Chinese authorities when it pressed ahead with its New York listing in June, even though the regulator had urged the company to put it on hold while a cybersecurity review of its data practices was conducted, sources have told Reuters.

Soon after, the CAC launched an investigation into Didi over its collection and use of personal data. It said data had been collected illegally and ordered app stores to remove 25 mobile apps operated by Didi.

Didi responded at the time by saying it had stopped registering new users and would make changes to comply with rules on national security and personal data protection, and would protect users' rights.