Caixin
Sep 06, 2021 07:35 PM
BUSINESS

Didi Denies Reports of Beijing Government-Led Takeover

What’s new: Didi Global Inc. has denied reports that the Beijing municipal government is coordinating a proposal for state-backed companies to take a controlling stake in the ride-hailing firm as it faces regulatory scrutiny.

Citing unnamed sources, Bloomberg reported Friday that several Beijing-based companies, including Shouqi Group — which is part of the state-owned Beijing Tourism Group Co. Ltd. — would acquire such a stake in Didi.

The proposal could include taking “a sizeable slice of Didi” or “a nominal stake accompanied by a golden share with veto power and a board seat,” the report said.

“Foreign media reports of the Beijing municipal government coordinating companies to invest in Didi are untrue,” the company said in a statement (link in Chinese) on social media platform Weibo on Saturday.

The background: Last month, Didi denied a South China Morning Post report about a looming management reshuffle within the company amid the ongoing investigations.

The reports come as the Beijing-based firm had been caught in a series of regulatory actions on national cybersecurity and personal data safety concerns in the wake of rushing its $4.4 billion U.S. IPO at the end of June.

On July 1, Chinese regulators said they would investigate Didi for national security and data risks. They ordered the company to stop registering new users during the investigation and had its main ride-hailing app removed from app stores.

On Friday, the company and 10 others were summoned by the transportation ministry and other departments to fix issues including unfair competition and mistreatment of drivers and passengers.

 Read more  
Cover Series: How Didi’s Rush to Raise Funds in U.S. Backfired (Part 1)

Quick Takes are condensed versions of China-related stories for fast news you can use.

Contact reporter Kelsey Cheng (kelseycheng@caixin.com) and editor Michael Bellart (michaelbellart@caixin.com)

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