China to End Didi Cybersecurity Investigation
2022.06.06 13:01
By Geoffrey Smith
Investing.com — Chinese regulators are set to end an investigation into ride-hailing giant Didi Global (NYSE:DIDI) and two other U.S.-listed companies after nearly a year, The Wall Street Journal reported on Monday.
If confirmed, the move would be one of the first tangible signs of Beijing reducing the pressure on some of its big tech companies after a bruising campaign to reduce their economic clout.
For Didi investors, however, it comes too late to repair the damage: having listed in New York last year (against the wishes of Chinese regulators) at a price of $14, the ADRs had fallen to only $1.85 as of Friday’s close. The company decided last month to delist from the exchange, but hasn’t yet said what price it will offer existing shareholders for their stock.
Premier Li Keqiang has repeatedly promised that the government would ease up on its attitude toward tech giants, whose impact has been amplified by a heavy-handed approach to taming COVID-19 outbreaks that have weighed heavily on the economy this year.
A closely-watched barometer of Chinese business activity remained deep in contractionary territory in May, according to figures released earlier on Monday, even though it rebounded from its April low. The Caixin Services purchasing managers index stood at 41.4, up from 36.2 in April.
In addition to Didi, regulators are also set to close investigations into logistics platform Full Truck Alliance (NYSE:YMM) and online recruiting firm Kanzhun (NASDAQ:BZ), the WSJ said. It noted that the three companies had a combined market value of some $115 billion when the probes were announced last year. That has since fallen to $25 billion.
