"'Chinese Uber' Didi Chuxing, Vote Today on Delisting from New York Stock Exchange"

[Image source=Yonhap News]

[Asia Economy Reporter Kim Hyunjung] China's largest ride-sharing company Didi Chuxing will hold an extraordinary general meeting in Beijing on the 23rd to vote on whether to delist from the New York Stock Exchange.

Bloomberg reported on the 22nd (local time) that "Didi Chuxing will be delisted from the New York market after a shareholder vote," adding that "this marks the end of an 11-month ordeal along with a market value of $60 billion." The vote will be conducted on a one-share, one-vote basis. According to the annual report, Didi's management, SoftBank, Uber, and Tencent hold about 48% of Didi's shares.

The report cited market observers explaining that through this extraordinary general meeting, Didi Chuxing will seek ways to cooperate with government regulatory agencies. It further stated, "Only then can it freely prepare for listing on the Hong Kong Stock Exchange and achieve the best possible outcome that investors can expect."

This procedure is being actively pursued five months after the company announced its delisting plan in December last year, following government pressure that was negative toward Chinese big tech companies listing on the New York Stock Exchange. Despite government opposition, Didi Chuxing pursued an initial public offering (IPO) in New York in June 2021. Through the listing, it raised $4.4 billion, the largest since Alibaba Group in 2014. However, afterward, China enforced comprehensive pressure by forcibly removing the company from app stores and conducting cybersecurity investigations. In response, on December 3 last year, Didi Chuxing announced on Weibo, the Chinese version of Twitter, that "it will immediately begin the process of delisting from the New York Stock Exchange" and "simultaneously start preparations for listing in Hong Kong."

Sean Meng, director at Beijing-based investment bank Chanson & Co., explained, "Investors have no choice but to accept the delisting, but they will closely track Didi's fate to see if the Chinese market can still be trusted." The level of fines or other penalties being discussed between Didi Chuxing and the Cyberspace Administration of China is still unclear.

Didi Chuxing was founded in 2012 by Cheng Wei, a former Alibaba salesperson, and surpassed the world's largest ride-hailing services to become the number one in its domestic market. After fierce price competition between the two companies, Didi Chuxing acquired Uber's China operations in 2016.