Didi’s shares tumble on report China plans unprecedented sanctions

Chinese ridesharing giant Didi came under pressure again Thursday after a report that Beijing is considering tough penalties ranging from a massive fine to even forced delisting after its IPO last month.

Didi shares fell more than 4% in pre-market on Thursday after losing 18% this month. Bloomberg News reported that Chinese regulators are planning a series of sanctions against Didi, including a fine that is likely higher than the record $ 2.8 billion Alibaba paid earlier this year.

The sanctions could also include the suspension of certain operations, the delisting or withdrawal of US shares in Didi, according to the report, citing people familiar with the matter.

Didi stock has lost around 18% to $ 11.50 a share since its market debut on June 30 when it started trading at $ 14 a share.

Last week, officials from seven Chinese government departments visited the offices of the ride-sharing giant to conduct a cybersecurity review. The ridesharing giant was forced to stop registering new users and its app was also removed from Chinese app stores.

The Cyberspace Administration of China alleged that Didi illegally collected user data.

Beijing is stepping up its watch over the flood of Chinese listings in the United States, which are largely tech companies. The State Council said in a recent statement that the rules of the “Foreign Listing System for Domestic Companies” will be updated, while also tightening restrictions on cross-border data flows and security. .

– Click here to read the original Bloomberg News article.