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Chinese language regulators recommended Didi postpone his US IPO: WSJ

© Reuters. FILE PHOTO: A trader works on the floor of the New York Stock Exchange (NYSE) in New York City, the United States, June 30, 2021 during the IPO of Chinese ride-hailing company Didi Global Inc. REUTERS / Brendan McDermid

(Reuters) – China's cybersecurity watchdog suggested Didi Global Inc postpone its IPO and asked it to review its network security weeks before the Chinese ridesharing giant went public, the Wall Street Journal reported on Monday, citing the matter familiar people.

It is not known whether Didi conducted his own review, according to the WSJ report. (https://on.wsj.com/3jKuGWx) However, a person close to the company told the newspaper that the company ultimately decided to go public as it faced increasing pressure from investors for a large payout.

The Cyberspace Administration of China () opened its investigation into Didi on Friday, just two days after the company began trading on the New York Stock Exchange.

On Sunday, the agency ordered Didi to suspend app downloads after discovering that the company had illegally collected user personal data.

Didi said in a statement Monday that prior to its $ 4.4 billion listing, it did not know that CAC would begin investigating the company and ordering the removal of its app.

According to the WSJ report, Beijing officials, especially those from the CAC, were wary that the ride-hailing giant's data holdings could potentially fall into foreign hands due to the greater disclosure associated with a U.S. listing.

China's internet regulators in recent years have tightened the rules for the country's tech giants, urging companies to properly collect, store, and process important data.

Didi, which provides services in China and more than 15 other markets, collects huge amounts of real-time mobility data every day.

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