Markets

Didi, Tencent and Alibaba tumble as Chinese regulator fines them over old deals

(mtag101702) Dhirendra Tripathi

investing. com – Didi Global (NYSE: DIDI), Tencent (NYSE: TME) and Alibaba (NYSE: FATHER) was lower in premarket on Thursday. The Chinese regulator has penalized companies for a series of irregularities related to merger agreements over the past decade.

Didi tumbled 6%, Tencent 4.6% and Alibaba 2.8%.

The State Market Regulatory Administration (SAMR) fined all three names on Wednesday, and while 500,000 yuan ($77,000) is a minor change for the country’s big tech names, that’s according to the Alibaba-owned South China Morning Post newspaper. The maximum measure given to breaches of the merger agreement under antitrust law.

The newspaper said that some mergers that were penalized took place before SAMR was established in 2018.

Beijing has put domestic technology companies, especially those trading on the US stock market, under heavy scrutiny. Controversial issues include information security, consumer privacy, and anti-competitive practices.

Last weekend, Chinese authorities asked Didi to stop new user registration and remove the Didi app from stores such as WeChat and Alipay.

In a brief statement on Tuesday, China’s State Board said it will review the rules for overseas stock market listings and that publicly traded firms will be responsible for maintaining data security. He also stated that China will increase its control over companies that process in overseas markets.

More than one of these companies Nasdaq or listed on the NYSE, Chinese officials are concerned about the consumer information these companies must share with the Securities and Exchange Committee (SEC) and other American authorities in order to comply with the legislation.

The new restrictions threaten to prevent the acquisition of assets from empires’ subsidiaries. On Thursday, the Financial Times reported that China’s best-known fitness app, Keep, has withdrawn its plans to enter the US stock market. Tencent and Japan-based SoftBank amid Keep’s backers (OTC: SFTBY).

Related Articles

Leave a Reply

Your email address will not be published. Required fields are marked *

Back to top button