Chinese ride-hailing giant Didi surged 24% after report that regulators are ending probes.
- Shares of Chinese ride-hailing giant Didi surged more than 24% during regular trade in the U.S. on Monday after The Wall Street Journal reported regulators are concluding investigations into the company.
- Didi has been one of the worst-hit companies by Beijing’s regulatory tightening and has been the subject of a cybersecurity probe since days after its U.S. IPO.
- But there have been signs of regulatory easing from Beijing as China deals with economic fallout from the weekslong lockdown in Shanghai.
DIDI surges
Shares of Chinese ride-hailing giant Didi surged more than 24% during regular trading in the U.S. on Monday afterThe Wall Street Journalreported regulators in China are concluding investigations into the company.
The Journal report said authorities would lift a ban on Didi adding new users as early as next week and reinstate the company’s app in domestic app stores, citing people familiar with the matter.
By the Monday market close on Wall Street, Didi shares jumped 24.32%.
The cracdown
Since the end of 2020, China has tightened regulation on its domestic technology sector in areas from antitrust todata protection. But there have beensigns of regulatory easingfrom Beijing as China deals with theeconomic falloutfromweeks of lockdown in Shanghai.
Didi has been one of the worst-hit companies as a result of Beijing’s crackdown. Last year, the ride-hailing firmwent public in the U.S.But just days after the initial public offering, Chinese regulators opened acybersecurity probe into the company.
In July, the Cyberspace Administration of China accused Didi ofillegally collecting users’ dataand ordered its app removed from local app stores.
The Journal reported that Chinese authorities will also end probes into two other U.S.-listed Chinese tech firms — Full Truck Alliance and Kanzhun —which were also under investigation.
CNBC reached out to Didi, Full Truck Alliance and Kanzhun outside office hours, and has yet to receive a response.
Chinese authorities along with the CAC told Didi and the other two firms about the plans to end the probes in a meeting last week, the Journal reported. Didi is expected to face a large fine, while the Full Truck Alliance and Kanzhun will face smaller ones, the Journal said.
In May, Didi revealed that it was beinginvestigated by the U.S. Securities and Exchange Commissionin relation to its IPO last year.
Didi shares have fallen about 85% since the PO price of $14. Didi said in December that it willdelist from the New York Stock Exchangeand seek to list in Hong Kong instead.
source：CNBC
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