Tech

Chinese regulators move Diddy to Hong Kong listing Nudge

Singapore — China’s Internet Watchdog Proposes Ride Hailing Giant

Didi Ltd

DIDI 0.70%

Two other US-listed tech companies are investigating listings in Hong Kong as Beijing compiles cybersecurity investigations into companies, people familiar with the matter said.

The China Cyberspace Administration, which launched a data security review of apps run by the three companies in July, broke the idea in a recent conversation with executives at Didi, a logistics platform.

Full track alliance Ltd

YMM 1.81%

And online recruiting companies

Kanzun Ltd

BZ 1.04%

, People said. The three companies went public in June after raising a total of nearly $ 7 billion.

Authorities are expected to provide findings After the probe is finished As soon as next month, people said.

In recent years, listing Chinese high-tech companies trading abroad in the country or in Hong Kong has become a national priority. Beijing is concerned that data-rich companies could pose political or national security risks by responding to US regulatory agencies. There is less confusion for companies and their investors.

Listing in Hong Kong makes it easier for mainland Chinese investors to invest and profit from the growth of these rapidly expanding companies.U.S. listed companies like

Alibaba Group Holding Ltd

When

Baidu Ltd

For the past two years, we have been soliciting shares in the city.

Chinese authorities are planning to propose a new rule prohibiting companies with large amounts of sensitive consumer data from being published in the United States, the Wall Street Journal previously reported.

Launched a few days after Diddy’s release in the U.S., the cybersecurity review is part of a broader crackdown on China’s Internet industry with technology giant Alibaba.

Tencent Holdings Ltd

Over the past year, Chinese regulators have cracked down on the characteristics of monopoly and unfair practices in the domestic consumer Internet industry and introduced new rules governing data protection and public listing abroad.

Customers prepared to retrieve their bicycles from Didi in Hangzhou, China earlier this year.


Photo:

Qilai Shen / Bloomberg News

China’s Cyberspace Administration, Didi, Kanzun, and the Full Track Alliance did not respond to requests for comment.

The Full Truck Alliance, which provides Uber-like services to the Chinese truck industry, is already looking for a service in Hong Kong, two people said. One said the listing could be as early as next year and the decision was made before the review began. The company thought it would open up opportunities for investors close to the domestic market who are familiar with its business.

Chinese internet companies seeking listings in Hong Kong are in line with a wide range of trends over the last two years.Didi Initially aimed at listing on the Hong Kong Stock Exchange However, the journal previously reported that it later abandoned the plan because it did not meet the requirements of the exchange.

On July 2, Chinese regulators announced a cybersecurity investigation into Diddy, a move triggered by the company’s rushed public offering on the New York Stock Exchange. At that time, cyberspace regulators warned the company to postpone the listing until it was able to conduct a thorough internal security review, the journal reported.

The announcement of the probe to the Full Track Alliance (also known as the Manban Group) and Kanzun took place less than a week after Diddy. During the investigation, all three companies were blocked from registering new users.

As part of a cybersecurity review, authorities spent about two months investigating companies, primarily in the field, people familiar with the investigation said. They asked senior executives, collected email and internal communications, and tracked how companies stored and used user information, they said.

Some of Diddy’s research focused on the decision-making process behind the company’s public offering, they said.

Regulators have found little evidence to support the claim that companies pose a national data security risk by listing in the United States and giving US regulators full access to review audit documents. People said they didn’t.

Beijing’s campaign to attack domestic tech companies has already discouraged global investors from funding Chinese internet startups, causing a wave of Chinese tech companies refraining from listing in the U.S. .. As of October 20, it has almost halved to $ 8.62. FullTruck Alliance shares are down about 10%, but Kanzhun shares

Nasdaq Stock Market

It is almost flat.

Write in Keith Zai keith.zhai@wsj.com And in Lizarin Liza.Lin@wsj.com

Copyright © 2021 DowJones & Company, Inc. all rights reserved. 87990cbe856818d5eddac44c7b1cdeb8

Chinese regulators move Diddy to Hong Kong listing Nudge

Source link Chinese regulators move Diddy to Hong Kong listing Nudge

Back to top button