[EpochTimesJuly092021](Epoch Times reporter Liu Yi comprehensive report) After the CCP claimed to strengthen the review of Chinese concept stocks listed in the United States, many mainland companies preparing to list in the United States suspended their listing plans .
The State Council of the Communist Party of China stated on July 6 that it will tighten regulations on companies seeking to sell shares overseas and strengthen supervision of overseas listed companies.
After the news came out, China’s medical big data company Zerokrypton Technology, which was previously preparing to go public, suspended its listing plan.
According to Reuters on July 8, three people familiar with the incident said that due to the tightening of supervision, ZeroKr Technology decided to shelve its IPO plan. One of the sources said that regulatory uncertainty affects both companies and investors.
LingKr Technology applied for an initial public offering (IPO) in the United States in June. It plans to sell 10.8 million shares at a price of US$17.50 to US$19.50 per share. If the price is set at a high-end guide price range, it will raise US$211 million. It was originally scheduled to price its shares after the US market closes on the 8th.
Two sources said that the subscription had ended on the 7th one day earlier than originally planned.
According to the source, this is the first Chinese company known to withdraw its IPO plan since China’s cybersecurity regulatory authority stepped up its regulatory actions last week.
In addition, according to the British “Financial Times” on July 9th, China’s most popular fitness app “Keep”, invested by Japan’s SoftBank (SoftBank) and China’s Tencent (Tencent), cancelled its application for an initial public offering (IPO) in the United States last week. plan of.
According to two people familiar with the matter, Keep expected to raise 500 million US dollars, but it did not submit the listing application as planned, and the banker from Morgan Stanley hired by it canceled the presentation meeting with investors this week.
The Hong Kong Economic Journal reported on the 9th that China’s largest podcasting platform Himalaya has also cancelled its US listing plan. The newspaper also quoted Bloomberg’s news that the convenience store chain Bianlifeng had submitted a listing application to the U.S. Securities and Exchange Commission (SEC) in a confidential manner and planned to raise US$500 million. However, Bianlifeng denied this report when replied to Lu Media.
According to news from China Beduo Finance on the 8th, Atour Group (Atour Hotel, NASDAQ:ATAT) and Soul (NASDAQ:SSR) and other companies that originally planned to go public on NASDAQ have also postponed the IPO process and the time to go public. To be determined.
Among them, Soul issued an announcement saying that it has received the possibility of other capital operations. Therefore, the IPO process is temporarily suspended. At the same time, Soul said that “large shareholder Tencent also supports this decision.” It is understood that Soul originally planned to land on the Nasdaq in the United States on June 24, 2021.
According to the news, from July 1st to 8th, no more Chinese concept stocks that intend to go public in the United States will submit a prospectus.
And all this happened after the CCP suppressed Didi Chuxing, which was listed in the United States, and said it strengthened control of Chinese concept stocks listed in the United States.
On June 30, China Didi Chuxing went public in the United States, raising US$4.4 billion, with a market value of approximately US$68 billion.
On July 2, the Cyber Security Review Office of the Communist Party of China issued an announcement to implement a cyber security review of Didi Travel. On July 4, the State Internet Information Office of the Communist Party of China claimed that the Didi Chuxing App had serious problems in collecting and using personal information in violation of laws and regulations and removed it from the shelves.
After the news that Didi was suppressed by the CCP, Didi’s share price plummeted. According to the news on the mainland Caixin.com on July 9th, Didi (NYSE:DIDI) was latest at $11.22 per share, which was lower than the opening price of the first trading day. At 16.65 US dollars per share, down 32.61%, the market value dropped from US$79.82 billion on the first day of listing, down US$26 billion to US$53.818 billion.
There is news that the CCP is revising its rules to supervise the overseas listing of Chinese technology giants.
The State Council of the Communist Party of China said on the 6th that it will tighten regulations on companies seeking to sell shares overseas and strengthen supervision of overseas listed companies.
Bloomberg News quoted a source on July 7 as saying that the China Securities Regulatory Commission is taking the lead in revising overseas listing rules that took effect in 1994 because these rules do not mention companies registered in tax havens such as the Cayman Islands.
They said that once revised, these rules will require high-tech companies that adopt a variable interest entity (VIE) structure to seek approval from the Chinese Communist Party before listing in Hong Kong or the United States.
The VIE structure was first used by Sina in the NYSE IPO in 2000. Usually these companies are registered in offshore tax havens that do not fall under the jurisdiction of the Chinese Communist Party, such as the Cayman Islands or the British Virgin Islands. They do not have to face the same regulatory review and IPO verification as Chinese companies planning to list in the country; at the same time, They can also transfer domestic company profits to offshore entities and have shares owned by foreign investors.
Bloomberg reported that the CCP’s proposed stricter supervision will close this gap.
Affected by the news of the Chinese Communist Party’s suppression of China’s concept stocks, the US stock market closed on July 8, and China’s concept stocks continued their downward trend. This was a collective decline in five consecutive trading days since July 1. Excluding the stocks that were suspended from trading, nearly 78% of China’s concept stocks fell on July 8.
Editor in charge: Li Muen#
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