REUTERS: The Wall Street Journal reported on Monday that China’s cybersecurity watchdog proposed Didi Global Inc delay its initial public offering and encouraged it to assess its network security, weeks before the Chinese ride-hailing giant went public. According to the WSJ story, it is unknown whether Didi conducted its own investigation. However, a source close to the company informed the newspaper that the company eventually chose to proceed with the IPO due to mounting investor demand for a large dividend.
Didi was investigated by the Chinese Cyberspace Administration (CAC) on Friday, only two days after the business began trading on the New York Stock Exchange.
Didi’s app downloads were suspended by the agency on Sunday after it was discovered that the business had improperly gathered personal user data.
Didi claimed in a statement on Monday that it had no idea CAC would begin an investigation into the firm and ask its app to be taken down before its US$4.4 billion IPO.
According to the WSJ report, officials in Beijing, particularly those at CAC, were concerned that the ride-hailing giant’s troves of data could fall into foreign hands as a result of the increased public exposure connected with a U.S. listing.
In recent years, Chinese internet regulators have tightened rules for the country’s digital titans, requiring them to properly gather, store, and handle sensitive data.
Didi, which operates in China and over 15 other regions, collects massive amounts of real-time mobility data on a daily basis.
(Bengaluru-based Rithika Krishna contributed reporting; Sonya Hepinstall edited the piece.)/n
