A growing number of Chinese stocks may be delisted from the U.S. stock market as the U.S. tightens regulations on U.S.-listed Chinese companies. Sources said that Sina, a U.S.-listed Chinese Internet giant, may be allowed to privatize and delist from the market this week.
Taiwan‘s Free Finance reported on Dec. 23, citing the Nihon Keizai Shimbun, that Chinese Internet giant Sina, which is listed on the NASDAQ exchange, is rumored to be approved for privatization and delisting.
New Wave MMXV Limited, a company controlled by SINA Chairman and CEO Cao Guowei, has offered SINA shareholders $43.30 per share in cash to take the company private, the report said. SINA’s market capitalization reached $2.59 billion.
Cao’s offer reportedly requires at least 2/3 of shareholders to vote in favor of the offer, with the support of Sina’s board of directors, although Cao alone controls 61% of Sina’s voting rights.
Sina Group completed its listing on Nasdaq in 2000 and was one of the first Chinese Internet companies to go public in the US.
At least 14 Chinese companies listed in the U.S. in 2020 have received or accepted offers from investors to take their companies private, including Chinese information classified platform 58 Tongcheng and search engine Sogou, the highest number since 2015, as the U.S. tightens regulations on Chinese stocks. Currently, 58.com shareholders are in favor of taking the company private, and the privatization deal is expected to be completed by the end of 2020.
In addition, Jingdong and NetEase both have secondary listings in Hong Kong in 2020.
The U.S. House of Representatives passed the Holding Foreign Companies Accountable Act on December 3, 2020, which prohibits foreign companies from listing in the U.S. if they fail to undergo audits by the U.S. Public Company Accounting Oversight Board (PCAOB) for three consecutive years.
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