(Bloomberg) — Didi Global Inc. plunged 42% on Friday after the company suspended preparations for its planned Hong Kong listing.
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The decision came as the Cyberspace Administration of China informed executives of the ride-hailing giant that their proposals to prevent security and data leaks had fallen short of requirements, according to people familiar with the matter. Didi’s main apps, removed from local app stores last year, will remain suspended for the time being, said one of the people, who asked not to be identified as the information is private.
The company and its bankers have halted work on the Hong Kong listing originally slated for around the summer of this year, the people said. In addition to dealing with the CAC review, Didi is also working to finalize its fourth-quarter results as required for a listing prospectus, they said.
Didi’s American depositary shares posted their biggest-ever decline, plummeting to as low as $1.96 in New York.
Didi became one of the biggest targets of a tech-sector crackdown by Chinese authorities after it pushed through a $4.4 billion U.S. initial public offering in June. Days after its listing, the company was placed under a cybersecurity probe and its services were taken off Chinese app stores.
Read More: Didi’s Move From NYSE to Hong Kong – What to Know: QuickTake
The ride-hailing giant has since explored several alternatives including hiving off data to a third-party Chinese firm and selling a stake to state-backed companies, Bloomberg News has reported. Its shares had already dropped about 76% from its IPO price before Friday’s decline. Didi revealed a $4.7 billion loss after revenues shrank in the September quarter following Beijing’s regulatory assault against the tech sector.
Didi in December announced its plan to delist in the U.S. and pursue a listing in Hong Kong.
The suspension threatens to derail Didi’s plans to move its listing closer to home, which would allay Beijing’s concerns about the leak of sensitive data overseas. Now, the CAC’s dissatisfaction with…