By
Temitope Olatunji
March 11th, 2024
The Chines fitness app and SoftBank however declined to comment on the alleged foiled IPO plans.
Famous Chinese fitness app has called off plans to file for an Initial Public Offering in the United States amid the latest attempt to crackdown crypto firms by the Chinese government. According to sources close to the company of the Chinese fitness app, the decision not to follow through with its New York IPO plans came after Chinese regulators announced an investigation into data security concerns at ride-hailing company DiDi.
Keep which is backed by China’s Tencent and Japanese banking giants SoftBank was expected to raise over $500 million but has now canceled its plan to file for an IPO while Morgan Stanley, its bankers have also canceled numerous marketing meetings with investors this week.
The latest investigation by Chinese regulators into possible data security breaches by DiDi and other Chinese companies listed in the U.S according to market experts is going to disrupt billions of dollars of technology listings that are planned for New York this year.
Beijing announced on Tuesday that it was stretching its oversight and tightening its restrictions on the growing number of Chinese companies listed on US exchanges in a move that could threaten more than $2t worth of shares on Wall Street. The announcement stated that Chinese companies will endure difficult processes to earn a listing in the US. China’s latest attempt at its crypto crackdown has triggered a sell-off in Chinese technology stocks. Beijing however revealed that its main concern is whether foreign government officials are gaining access to its citizens’ data as part of the listings.
Keep, now adds to the already long list of Chinese companies to cancel US IPO plans. China’s biggest podcasting platform, Ximalaya, earlier last month also canceled its US IPO plans. A source close to the company speaking on that turn of the event stated that “After communication with the relevant regulators, Ximalaya understands that a Hong Kong listing would be a much better and preferred outcome.”
Chinese medical data solutions provider, LinkDoc Technology, earlier this week canceled its Nasdaq IPO plans this week. According to reports, LinkDoc Technology was expected to price its shares on Thursday and was expected to raise a figure of over $200 million expected. The Chines fitness app and SoftBank however declined to comment on the alleged foiled IPO plans.
This development is the latest blow for SoftBank, which holds a 20% stake in Didi, making it the largest shareholder. Shares of the Japanese bank shares fell 5% yesterday after news of China regulators investigating, stopping new registrations to its app in the process. The bank is also an investor in Full Truck Alliance, another US-listed tech company under investigation by the Chinese data watchdog.