New Delhi: Didi Global falls on Tuesday in US trade as a cheerful company faces supervision of data security and wider Chinese crackdown in companies that include their shares abroad.
The Chinese State Council issued a warning to sweep China’s largest company, vowed to tighten data security supervision and foreign listings.
The announcement followed the opening of the security review by China’s internet regulator last week and request for the application store to remove Didi.
American depository shares Didi fell by 25% to $ 11.6, destroying around $ 22 billion in market value and taking stocks below the price of $ 14 from the initial public offering.
Didi based in Beijing controls almost all markets from travel in China and collect $ 4.4 billion last week at the second largest US IPO for a Chinese company.
Broadside Countries mark the increase in President XI Jinping campaign to bring their nation-and rim technology companies from valuable data – under control.
During the weekend, China also moved to two other companies which were also recently registered in New York – full truck alliance and Kanzhun.
“Because there is no mechanism for cross monitoring from securities, which conducts security reviews on data that can function as an effective tool for Chinese regulators to control companies registered abroad,” Xia Hailong, a lawyer in Shenlun based in Shanghai said the word firm law.
The Didi probe surprised investors, hammering Hong Kong shares from Tencent to Alibaba and Meituan.
Investors were worried that the latest security-based probe had opened a new front in the broader XI campaign against China’s internet giants which began in November with the collapse of the IPO Ant Group and the next antitrust probe to Alibaba and Meituan.