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Didi New York hits China’s list in the US even more

Ridehaling giant Didi’s plans to withdraw from the New York Stock Exchange could cause an even more severe chill after the listing of Chinese companies on the world’s most liquid markets fell this year. There are bankers and advisors, said.

China’s list in the US has plummeted since Diddy’s debut in New York on June 30th.

Two days after Diddy’s initial public offering, Chinese regulators ordered an ongoing company investigation, ordered the app store to remove 25 mobile apps, and blocked the app for new users in mainland China.

Regulatory measures have already caused a sharp slowdown in China’s listing, along with the ongoing threat of the US government to delist Chinese companies that do not comply with audit rules.

According to Dealogic data, the second half of this year is the quietest of the six months since the first half of 2017, when Chinese companies listed in the United States, with a total listing of nearly $ 13 billion so far in 2021. ..

According to the Stock Exchange Commission (SEC), Chinese companies listed on the US stock exchange must disclose whether they are owned or controlled by a government agency and provide evidence of audit inspection.

“IPOs from China to the United States are limited,” a Hong Kong banker told Reuters. The city’s financial sector has digested the impact of Didi’s decision on the listing pipeline.

The banker was not named because the person was not allowed to speak to the media.

Independent research analyst Mitchell Kim, who publishes on the Smartkarma platform, said already cautious investors will be more nervous about future China’s IPO in the world’s largest economy.

“US investors may be afraid to invest in Chinese companies, which may prevent Chinese companies from accessing US capital,” Kim said. “Especially because so many technology investors are based in the United States, Chinese engineers can face greater challenges.”

Justin Hall, a partner at Golden Gate Ventures, said that while Diddy’s delisting could negatively impact global investors’ desire for Chinese tech companies, it would do the same for Chinese retail and institutional investors. He said it was premature to say.

“It’s important to note that just because Chinese tech companies aren’t listed so often in the United States doesn’t mean they can’t make a successful public offering on Chinese exchanges,” he said. I did.

“Similarly, the founders of Chinese tech companies would waste the time and resources needed to list on a US-based exchange if they were subsequently delisted. In the future, we may choose a safer exchange. ā€¯According to market participants, Hong Kong has recently had two Chinese companies listed in the United States as a backup in the event of delisting from New York. We are benefiting from the US-China relations that are being listed next.

Another investment banker in Hong Kong was a little optimistic that Chinese companies that did not process large amounts of data could choose to go public in New York.

Chinese regulators have pressured Diddy executives to devise plans to delist from the New York Stock Exchange because of data security concerns, sources told Reuters last month.

“Didi’s problem lies in the data. If the data problem is resolved, it’s okay,” said a banker who couldn’t be named because of the confidentiality of the problem.

Didi New York hits China’s list in the US even more

Source link Didi New York hits China’s list in the US even more

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