Didi (NYSE: DIDI)After going public, it has been very smooth, until yesterday, Beijing said that it is conducting a cyber security review of this large technology company.
On July 2, the Cyber Security Review Office issued the “Announcement of the Cyber Security Review Office on the Initiation of Cyber Security Review of Didi Travel”, which aims to safeguard national security and public interest.
In response, the online car-hailing giant stated that it “will fully cooperate with relevant government departments during the review period.”
“We plan to conduct a comprehensive inspection of cyber security risks and continue to improve our cyber security systems and technical capabilities.”
In addition, a number of law firms, including shareholder rights law firms Johnson Fistel and LLP, announced today that they are investigating allegations made by the China Cyber Security Review Office.
“Specifically, Johnson Fistel’s investigation aims to determine whether the company’s documents related to the IPO in June 2021 and subsequent investor communications submitted by the company to the US Securities and Exchange Commission contained false statements of material facts, or did not state other necessary The fact that its statement will not mislead the company’s business and operations.” said the San Diego-based law firm.
China’s move took place a few days after Didi went public. Before today, Didi’s share price closed higher in the first two trading days. But on the other hand, Didi’s share price fell 11% today.
A Reuters report last month stated that Didi was fined $772.7 million in the second quarter because the company was accused of failing to seek approval for the establishment of a new joint venture. The news has exacerbated Didi’s anti-monopoly review by China’s market regulators.
Even with antitrust concerns, many people are still optimistic about Didi, including the host of the financial show “Mad Money” Jim Kramer and Atlantic Securities analyst Xiao Ai. Prior to Didi’s listing, Xiao Gang rated Didi as “overweight” with a target stock price of $25. In the short term, concerns about network security may bring some volatility to the stock. Investors who want to buy on dips may have to proceed cautiously to see how the overall market sentiment is next week after the holiday.Return to Sohu to see more
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