For Didi, the U.S. Is a Wonderland of Amateurs
Foreign investors are on the hook for unknown risks, as the ride-hailing giant becomes a test case for China’s new cybersecurity law.
Buckle up, U.S. investors.
Photographer: Gilles Sabrie/BloombergThe Chinese have a nickname for unsophisticated stock investors. They call them chives, a healthy crop that can flourish soon after planting, which keep coming up again and again — just like the chumps chasing meme stocks and blank-check companies for spectacular returns. The U.S. market seems to be the perfect place for Chinese companies to harvest chives.
This sure feels like what’s happening with Didi Global Inc., the ride-hailing giant. Just days after the company pulled off one of the largest U.S. public offerings this year, raising $4.4 billion, China’s cyberspace regulator ordered app stores there to remove the Didi Chuxing app, citing serious violations related to the company’s collection and usage of personal data. The latest move came just two days after regulators blocked the mainland business from adding new users, and put the company’s cybersecurity practices under review. In a statement Sunday, Didi said current users who had already downloaded the app wouldn’t be affected by the move.