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Caixin

Chinese companies face rocky path in tapping US markets

Some firms seek alternate listings amid tighter scrutiny by both countries

A trader works during the IPO for Chinese ride-hailing company Didi on the New York Stock Exchange in New York on June 30.    © Reuters

The race by Chinese internet companies to raise money in the U.S. stock market this year came to an abrupt halt after Didi's rush to sell shares on the New York Stock Exchange without the blessing of Chinese authorities backfired.

Initial public offerings (IPOs) abroad by private companies like Didi didn't previously require official approval by Chinese regulators, but they usually still needed an unofficial nod. By proceeding without such a signal, the Chinese ride-hailing giant wound up under national security review, its apps removed from app stores, and its shares trading 14.5% below the IPO price.

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