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    Saturday, September 4, 2021

    Didi Denies Reports that China Is Coordinating Companies to Invest in It

    Didi Chuxing, the world’s largest ride-hailing company, has denied various media reports that the Beijing municipal government is leading a proposal to invest in the company that will put it under state control.

    “Foreign media’s claim about Beijing’s municipal government coordinating relevant companies to invest in Didi is untrue,” the company said in a statement published on Weibo on Saturday afternoon. Shouqi Group – part of the influential Beijing Tourism Group – and other firms based in the nation’s capital would acquire a stake in Didi in the form of a “golden share”, with a board seat and veto power, under a preliminary proposal reported by Bloomberg on Friday, citing people familiar with the matter.

    The report comes months after the Chinese government took a minority stake and a board seat in TikTok owner ByteDance’s main domestic subsidiary, which may signal closer oversight by Beijing over the country’s most valuable technology unicorn.

    There have been plenty of speculation about Didi’s future following the government’s cybersecurity review of the company, an initiative led by a task force of seven Chinese agencies including the Cyberspace Administration of China (CAC), the Ministry of Public Security and the Ministry of National Security.

    The investigation was made after Didi’s US initial public offering. The CAC had asked Didi to review its network security, but the firm pushed ahead with its listing on June 30 without doing so – only to have US$29 billion, or 43 per cent, of its market value wiped out in less than a month after Beijing banned new downloads of the app.

    Didi last month denied a South China Morning Post report, which cited several sources, that a management reshuffle looms for the company in the wake of the government’s cybersecurity review.

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