BEIJING: Chinese regulators could hit ride-hailing giant Didi Chuxing with a more severe punishment than Alibaba’s record fine, just weeks after its contentious New York initial public offering, a report said.
Despite pushback from China against the move, Didi on June 30 went ahead with its debut in New York, surging 10 percent. However, just days later Beijing announced a probe into the company citing cybersecurity concerns, and ordered its app be removed from stores.
The move sent the firm’s shares plummeting and raised concerns about its business outlook.
And its problems got worse earlier this month when officials from seven departments, including the ministry of public security, were sent to the firm for on-site cybersecurity investigations.
Didi’s decision to go public despite Beijing’s displeasure has been seen as a challenge to the leadership, Bloomberg News reported Thursday, citing people familiar with the matter.
Regulators are now considering potential punishments that could include a huge fine, suspension of certain operations, or the introduction of a state-owned investor, the report added.
The reprimand could even force a delisting or withdrawal of Didi’s US shares, it added.
