Monday , 27 May 2024
Home Global Economy Financial loss in Chinese mobile transportation company Didi reaches $ 6.3 billion
Global Economy

Financial loss in Chinese mobile transportation company Didi reaches $ 6.3 billion

The Chinese mobile transportation company Didi Chuxing, which started trading on the New York Stock Exchange on July 1, suffered major financial losses due to the investigation launched by the Chinese supervisory authorities about the company.

According to the BBC’s report, Didi’s operating loss, whose revenues fell 5 percent in the third quarter of the year, reached $6.3 billion in the first 9 months of the year. Due to the restrictions imposed by the Beijing administration in recent months, Didi’s share prices in the USA were also adversely affected.

In a statement made by Didi, it was reported that Daniel Zhang, CEO of Chinese e-commerce company Alibaba, who has been serving as Chairman of the Board of Directors since 2018, resigned from his position.

Due to pressure from China, the company said in a statement at the beginning of the month that it will move its shares from the USA to Hong Kong and said, “After rigorous investigations, the company’s shares traded on the New York Stock Exchange will be started immediately, preparations for the IPO in Hong Kong are started. It was decided to start.” it was said.

Security investigation against Didi

The mobile transportation company, which started trading on the New York Stock Exchange on July 1, faced an investigation in its country after its public offering abroad.

The China Cyberspace Administration (CAC) launched a cybersecurity investigation against the company, arguing that Didi did not meet the requirement to conduct an internal cybersecurity review before going public.

In the investigation, the institution, which detected serious violations regarding the company’s collection and use of personal data, ordered the removal of 25 applications belonging to the company from its internet stores in China on 9 July.

CAC also prohibited Didi from accepting new customers until the investigations were concluded.
The regulator had stated that from now on, every company that collects information about at least 1 million users will have to undergo a cybersecurity investigation.

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