Investing.com – ADRs of Didi Global (NYSE:DIDI) plunged more than 7% in Friday’s premarket trading as authorities in China asked the ride-hailing firm to delist from the NYSE because of security fears.
The Cyberspace Administration of China, the agency responsible for data security in the country, has directed Didi to work out precise details, subject to government approval, according to a Bloomberg report.
Proposals under consideration include a private buyout by core shareholders or a share float in Hong Kong followed by a delisting from the U.S., the report said.
The delisting is likely to happen at Didi’s IPO issue price of $14 though there is no final word yet on the plans, according to Bloomberg’s sources.
Didi debuted on the NYSE on June 30, and barring a brief period, has traded below its issue price of $14. The stock closed at $8.11 Wednesday. Markets were shut Thursday on account of Thanksgiving.
The company invited the wrath of Chinese authorities by ignoring their advice to delay its IPO, pending a full security review of its data handling practices.
Authorities in China have been concerned about its data-rich companies listed in the U.S. given the latter has strict norms on data disclosure to protect interests of investors, a policy that experts in China think runs counter to their interests since the data is extensive and belongs to their citizens.