By Dhirendra Tripathi
Investing.com – Didi Global ADRs (NYSE:DIDI) jumped 5.7% in Wednesday’s premarket trading on a report that the company is in talks to launch its initial public offering in Hong Kong in the second quarter.
The development offers hope to its existing shareholders that the company will continue to be a listed entity and the new listing will give them an exit option as and when share prices improve. Barring a brief period, Didi stock has traded below its issue price of $14 since it listed on the NYSE on June 30. The stock closed at $4.90 Tuesday.
Bankers to the ride-hailing firm have had preliminary discussions with the Hong Kong Exchanges and Clearing, a report in South China Morning Post said. The move is in line with the company’s decision to withdraw from the NYSE and list on the island. Didi has promised to ensure its NYSE-listed stock is convertible into tradable shares on another stock exchange.
Didi listed on the NYSE on June 30, ignoring the advice of the authorities in China that it should delay its public debut, pending scrutiny of its data handling practices. That didn’t go down well with the regulators in China, which then asked it to stop onboarding new users while also mandating online stores to take its apps off their platforms. It finally resulted in them pressuring it to delist from the NYSE.