A Chinese national flag flutters outside the China Securities Regulatory Commission (CSRC) building on the Financial Street in Beijing, China July 9, 2021. REUTERS/Tingshu Wang
March 11, 2022
SHANGHAI (Reuters) – Yum China Holdings the owner of KFC, Taco Bell and Pizza Hut restaurants in China, said it may have to delist from the New York stock exchange by 2024 after it was named by U.S. authorities as having failed to provide access to audit documents.
Yum’s Hong Kong-listed shares slid 10.2%.
“Under the current terms of the Act, the company’s common stock will be delisted from the New York Stock Exchange in early 2024, unless the Act is amended to exclude the company or the U.S. Public Company Accounting Oversight Board is able to conduct a full inspection of the company’s auditor during the required timeframe,” Yum said in a statement.
“The company will continue to monitor market developments and evaluate all strategic options.”
This week, the U.S. Securities Exchange Commission (SEC) identified five New York-listed Chinese companies that will be delisted if they do not provide access to audit documents.
Washington is demanding complete access to the books of U.S-listed Chinese companies, but Beijing bars foreign inspection of working papers from local accounting firms – an auditing dispute that puts hundreds of billions of dollars of U.S. investments at stake.
It has given these companies until March 29 to submit evidence to dispute their identification.
Among the other companies named are BeiGene Ltd which said in a filing that it is seeking solutions. Beigene shares tumbled 7%.
Also included are ACM Research Inc which said it is actively looking for solutions and and Zai Lab Limited which said its inclusion “will not materially impact operations”.
HUTCHMED (China) Limited was also named as a non-compliant issuer and did not immediately respond to requests for comment.
(Reporting by Roxanne Liu, Samuel Shen and Engen Tham in Shanghai; Editing by Kenneth Maxwell and Edwina Gibbs)
