BEIJING: Days after the company’s first public offering in the United States, China’s cyberspace regulator initiated a cybersecurity probe against Chinese ride-hailing giant Didi Global Inc and ordered that downloads of its app be halted in Chinese app stores. The following are significant events in Didi’s first public offering:
Oct 20, 2020 – According to Reuters, Didi is exploring an IPO in Hong Kong in 2021, abandoning prior plans to list in New York due to escalating Sino-US tensions, with a target valuation of more than US$60 billion.
March 24, 2021 – Didi is considering New York over Hong Kong for its initial public offering, with a target valuation of at least US$100 billion, according to two sources with direct knowledge of the situation.
According to Reuters, Didi has hired Goldman Sachs and Morgan Stanley to oversee its IPO, and the company aims to file confidentially for the New York IPO in April.
Didi files for a U.S. listing on June 11th, paving the way for what is believed to be the world’s largest initial public offering in 2021.
According to three persons familiar with the situation, China’s market regulator has launched an antitrust investigation into Didi.
The investigation, the latest in a sweeping crackdown on China’s so-called “platform” companies, is looking into whether Didi used any unfair competitive practices to squeeze out smaller rivals, as well as whether Didi’s core ride-hailing business’ pricing mechanism is transparent enough, according to sources.
“Unsubstantiated speculation from unnamed source(s) is not something we comment on,” Didi explains.
June 24 – According to persons familiar with the topic, Didi’s US$4 billion IPO has enough investor demand for its planned price range, meaning a valuation of US$62.4-US$67.2 billion.
June 28 – According to two persons with intimate knowledge of the situation, Didi will shut the investor order books for its IPO one day early on June 28.
Reuters claims that Didi will price its IPO shares at the top of or above the stated range, citing a source with direct knowledge of the subject.
June 30 – Didi raises US$4.4 billion in its first public offering, pricing it at the top of its expected range and increasing the number of shares issued, giving it a fully diluted valuation of US$73 billion and a non-diluted valuation of US$67.5 billion.
The stock finishes the first day of trading somewhat higher than the IPO price.
July 2: The Chinese Cyberspace Administration (CAC) announces that it has opened an inquiry into Didi in order to preserve national security and the public interest, and that Didi has been prohibited from registering new customers while the investigation is ongoing, driving Didi shares lower.
Didi says it will conduct a thorough investigation into cybersecurity threats and will fully collaborate with the appropriate government agency.
After discovering that Didi had illegally gathered users’ personal data, the CAC demands Chinese app companies to remove Didi’s app from their shops.
Didi announced that it would cease accepting new users, remove its app from app stores, and make improvements to comply with rules and protect customers’ rights. It claims that the move will have a negative impact on its revenue. The CAC announced cybersecurity investigations into Zhipin.com, an online hiring company, and Huochebang and Yunmanman, two truck-hailing companies that have joined to become Full Truck Alliance. Last month, the owners of Zhipin.com, Kanzhun Ltd, and Full Truck Alliance, went public in the United States. Didi claims it had no idea the CAC would initiate a cybersecurity probe or order a halt to new user registrations and app downloads in China before its IPO. (Beijing newsroom reporting; Alexander Smith editing)/n
