By Dhirendra Tripathi
Investing.com – Didi Global ADRs (NYSE:DIDI) traded nearly 2% higher in Tuesday’s premarket after the conclusion of a post-listing lock-up of shares took them down to a record low of $5.29 in the previous session.
The ride-hailing company listed on the NYSE on June 30 and its backers, including Softbank (OTC:SFTBY) and Uber (NYSE:UBER), were barred from selling their shares till the expiry of the 180-day lock up period, based on the June 29 date of its listing prospectus.
The company’s ban on staff selling its shares till it lists in Hong Kong – reported first by Financial Times -- also weighed on the shares Monday. There was another factor behind that weakness that swept other Chinese shares too with it – that of Chinese authorities bringing in new rules to curb new offshore listings in sectors restricted from foreign investment.
But for a brief IPO pop, Didi stock has traded below its issue price of $14 since listing as it has faced scrutiny from regulators. The stock closed at $5.30 Thursday.
Didi has had to bear the brunt of the Chinese authorities’ wrath for ignoring their advice to delay its public offering, 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.
The fate of the investors was sealed when the company earlier this month decided to delist from the NYSE and list in Hong Kong. Didi has said it will ensure its NYSE-listed stock is convertible into tradable shares on another stock exchange.