Didi blocks employees from selling stocks indefinitely

Didi Chuxing has banned current and former employees from selling shares in the company indefinitely, dealing a new blow to employees of the Chinese ride-hailing group, which has come under increased regulatory scrutiny following its listing. in New York.

December 27 was supposed to mark the end of a 180-day period during which current and former employees were not allowed to sell stock, but the moratorium was extended without a new end date, according to reports. people familiar with the matter.

The change is the latest setback for employees of the corporation, which has lost 60% of its value, or about $38 billion in stock market capitalization, since its initial public offering. $0.4 billion in New York in June. Chinese authorities opened an investigation into Didi’s data security practices days after the company went public and The group announced This month, it will be removed from the US and pursue a listing in Hong Kong.

The company is still unable to register new users, and China’s cyber regulator has ordered app stores to remove 25 of their other apps, including those that register new drivers. .

Government data shows Didi rides in China have fallen since its apps were removed from online stores, with passenger rides in November down 11% month-on-month. ten.

A person familiar with the situation said that current and former Didi employees will not be able to sell shares until the company has successfully launched a business in Hong Kong.

Didi employees say morale at the company is low and they are waiting for authorities to release the results of their investigation.

“There will certainly be a lot of disappointment about this,” said Li Chengdong, head of e-commerce consultancy Haitun.

“If you have been mulling over for three or four years and now there is no set date for an IPO in Hong Kong. . . maybe for some employees they won’t want to wait any longer, maybe they will leave,” he said.

However, a former employee on the operations team said he did not mind the delay. “I don’t intend to sell at these prices anyway,” he said. “It will work again someday.”

Didi did not respond to a request for comment.

Big Didi investors can still start selling their shares on Monday. This includes SoftBank’s Vision Fund, Didi’s single largest shareholder, paid 11.8 billion dollars for a 20.1% stake in 2019. The stake is now worth $5.4 billion and Didi’s mounting issues weighed on the share price of the Japanese technology corporation.

SoftBank did not respond to a request for comment.

Uber, the US ride-hailing group and a significant shareholder of Didi after merging its China operations with the group in 2016, has said it will gradually sell off its stake.

Didi’s other investors include Chinese tech conglomerates Tencent and Alibaba, Apple and dozens of venture capital firms.

Chinese media outlet LatePost first reported on the extension of the lockdown period for Didi employees.

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https://www.ft.com/content/695b5519-983f-4e44-a9c0-7e1cf1eca525 Didi blocks employees from selling stocks indefinitely

Huynh Nguyen

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