Didi is facing an investigation by the Securities Exchange Commission into its botched IPO last year, the Chinese company announced.
In a regulatory filing this week the firm said it is cooperating with the SEC investigation.
“We are cooperating with the investigation, subject to strict compliance with applicable PRC laws and regulations. We cannot predict the timing, outcome or consequences of such an investigation,” the company noted.
Didi launched a massive $4.4 billion IPO on the NYSE on June 30, 2021, the biggest U.S. share offering by a Chinese firm since Alibaba’s debut in 2014.
However, only days after that the Cyberspace Administration of China accused Didi of breaking privacy laws and posing cybersecurity risks, an action seen as punishment for the company’s decision to go public overseas.
Didi’s shares plunged almost 20% on the first trading day after the app was banned in China.
Under pressure from Chinese regulators, Didi announced last December that it would start the process of delisting from the New York Stock Exchange and move to Hong Kong. The company’s stock is down around 85% since its IPO and dropped 5% when the investigation hit the news.
After the case, now SEC officials are asking for more disclosures from Chinese companies seeking to go public in the U.S.
