China weighs serious penalties for Didi after market debut – Bloomberg News

FAN Editor
FILE PHOTO: Logo of Didi Chuxing is seen at its headquarters building in Beijing
FILE PHOTO: Logo of Didi Chuxing is seen at its headquarters building in Beijing, China August 28, 2018. REUTERS/Jason Lee/File Photo

July 22, 2021

(Reuters) – Chinese regulators are considering serious penalties for Didi Global Inc after the ride-hailing giant’s initial public offering last month, Bloomberg News reported on Thursday.

Regulators view Didi’s decision to go public despite pushback from the Cyberspace Administration of China (CAC) as a challenge to Beijing’s authority, the report quoted sources as saying. (https://bloom.bg/2UuxfSA)

Didi, whose shares were down 2.8% in premarket trading, did not immediately respond to a Reuters request for comment.

The CAC last week said officials from at least seven departments sent on-site teams to conduct a cybersecurity review of Didi.

Regulators are weighing a range of potential punishments, including a fine, suspension of certain operations or the introduction of a state-owned investor for Didi, according to Bloomberg News.

Earlier this month, the CAC launched a data-related cybersecurity probe into Didi just two days after the company raised $4.4 billion from its New York initial public offering.

Regulators also ordered Didi to remove its apps in China, which Didi said might hurt its revenue.

(Reporting by Tiyashi Datta in Bengaluru; Editing by Ramakrishnan M.)

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