Uber lost $ 2 billion in Didi episode this week on Threat of China’s repression

Uber CEO Dara Khosrowshahi speaks at a product launch event in San Francisco, California on September 26, 2019.

Filippo Pacheco | AFP via .

Uber’s one-time, share of $ 9.4 billion in Didi, the Chinese carousel giant, has gone down half in less than a month as China escalates its threats to US listed companies. More than $ 2 billion of the drop arrived this week.

The American depositary of Didi shares, which debuted at $ 14 a piece in June on the New York Stock Exchange collapses by 21% on Friday at $ 8.02, after falling 11% the day before. They had reached a closing high of $ 16.40 on July 1, the second day of trading.

Uber owns about 12% of Didi, making it the second- the largest investor behind SoftBank. Uber got its share in 2016 after selling his Chinese business to Didi in exchange for equity in his rival.

Didi’s IPO has arrived with A lot of hype ea market cap of close to $ 70 billion. But the honeymoon was short-lived, like in few days of the offer of separate reports revealed that Chinese officials were conducting a cyber security review of company and that Didi had been advised to postpone the listing e review his network weeks of safety before it ended public.

The news got worse this week, after Bloomberg reported that Chinese regulators are planning punishments against Didi, including a fine that could exceed the record Alibaba paid $ 2.8 billion before this year after an anti-monopoly investigation. Didi did not respond to requests for comment on the Bloomberg report earlier this week.

The penalties could include delisting or withdrawal of WE sharesBloomberg reported, citing people familiar with the question. Chinese lawmakers have announced plans of late to limit the ability of national companies a list overseas.

While Uber is still showing a profit from its initial investment in Didi, valued about $ 2 billion five years ago, is in drop fast. At the end of March, Uber valued the stake at $ 5.9 billion in his quarterly deposit. How of Friday, it is down at $ 4.6 billion.

Uber isn’t the only company to receive hit by Didi’s drop. SoftBank’s stake fell from nearly $ 14 billion after the IPO to under $ 8 billion. Tencent, the Chinese internet conglomerate, has seen the value of its holdings in Didi drop to $ 2.5 billion from about $ 4.3 billion.

Uber’s shares they held up this week, rising 2.3% to $ 47.26.

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