Three fishy things about the top of the party to the United States on the day of the drop

Less than 48 hours after China’s online car platform giant Drip (DiDi) listed on the U.S. stock market on the evening of June 30, Beijing time, it has been hit with a series of regulatory punches, including censorship, fines and the removal of its app. It is widely believed that this is the result of a series of reprisals by the Communist Party of China (CPC) authorities after the company’s IPO in the US.

However, there are three major oddities about the Drip IPO.

From the perspective of the listing location, as early as 2020, there were reports in the land media that the IPO of Drip was listed in Hong Kong. For example, in July of that year, reported that people close to the top of Drip confirmed to Caixin reporters that Drip was preparing for a Hong Kong IPO. In October of that year, there were further media reports that Drip was considering listing in Hong Kong in the first half of 2021 at the earliest. In March this year, there were also specific media reports that the drip will be submitted to the Hong Kong Stock Exchange in the second quarter, and in the third quarter to complete the listing, the valuation may exceed $ 60 billion.

At that time, the media also reported that Drip had its own considerations in choosing Hong Kong as the listing location, mainly because of the uncertainty of the U.S. policy towards Chinese companies, such as the announcement by the SEC in January 2021 to delist the three major Chinese operators. Secondly, Ali, NetEase, Jingdong, etc. have returned to Hong Kong shares and enjoyed huge valuation returns. In addition, Drip’s IPO in Hong Kong was valued at $60 to $80 billion, no less than the valuation of the U.S. stock listing.

However, the news on June 8 this year, the drop finally decided to give up the Hong Kong listing, choose to list in the United States, is expected to be the fastest third quarter into the matter. As for the reasons for abandoning Hong Kong to choose the United States, the drop official did not disclose.

From the perspective of the timing of the listing, 2021 is the first year of the Chinese Communist government’s Internet “anti-monopoly”, July 1 of this year is the Communist Party’s centennial celebration, coupled with Ant Financial Services is not far away, it seems impossible for Drip to go to Wall Street without a little political sense, especially at the mouth of the July 1 listing. Even if the drop is not, the internal party organization of the drop should be there.

For example, the Beijing Daily published an article in 2018 praising the party building work of Drip, which was upgraded to a party committee in September 2016 under the guidance of a higher-level party organization, and Drip travel went online within the APP with the party members’ bright identity function, which is at a high level among Internet companies. In addition, Drip is also affirmed to actively embrace regulation, such as its hitchhiking business after two fatalities in 2018, Drip specially hired a number of core cadres from the State Administration of Security and Public Security Interpol to be responsible for the all-round upgrade of Drip’s safety system.

In particular, if the drip U.S. stock listing involves the leakage of large data on domestic travel, that is a more serious security problem than Anthem, in June 8 when the news of the drip selection U.S. IPO was reported, regulators actually have plenty of time to call a halt, why not call a halt in time?

From the point of view of the shareholding structure, Drip was established in 2012, the earliest angel round of financing, from the former Alibaba executive Wang Gang. Since then to 2017 after several rounds of financing, VC, PE, state-owned capital giants gathered, but the most striking, is that a number of large central enterprises directly under the State-owned Assets Supervision and Administration Commission of the Communist Party of China, such as China Machinery Industry Group, through its holding subsidiary (State Machine Automobile) investment in Drip. Among the undisclosed funding rounds, the State New Science and Technology Fund also stands out. The highest total financing round was made possible by a syndicated loan led by China Merchants Bank, a subsidiary of China Merchants Group.

It is worth noting that in the prospectus, Drip said that 30% of the funds raised will be used to expand its business in international markets outside of China. And drop overseas layout is said to have a political mission, such as Latin America as the focus of global expansion, drop stand firm Latin America can advance into Europe.

In short, from the perspective of these important official shares of Drip, and according to Investopedia, Drip founders Cheng and co-founder Liu Qing may only hold less than 10% of the shares before the IPO, it is easy to understand that Drip’s IPO in the U.S. is no way to “cook rice” by itself.

The whole thing is full of suspicions as the drop completes its US IPO and the capital behind it, especially the official shares, pockets profits and harvests American leeks by the way.