App sale

China’s Full Truck Alliance suspends $1 billion Hong Kong listing – sources

Chinese trucking apps Huochebang and Yunmanman, owned by Full Truck Alliance, are seen on mobile phones in this illustrative photo taken July 5, 2021. REUTERS/Florence Lo/Illustration

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HONG KONG, April 28 (Reuters) – Full Truck Alliance Co Ltd (YMM.N), China’s “Uber for trucks” plans to raise $1 billion in a Hong Kong listing this year have been put on hold as a China’s cybersecurity regulator has yet to announce the results of an investigation into the company, two people with knowledge of the matter told Reuters.

The company, backed by investors including SoftBank’s Vision Fund and Tencent Holdings (0700.HK) and known as Manbang in China, has been planning a dual primary listing in Hong Kong since at least October. It raised $1.6 billion in its initial public offering (IPO) in New York last June.

But in July last year, the Cyberspace Administration of China (CAC) said it was reviewing two of Full Truck’s apps as part of investigations aimed at “preventing national data security risks and protect national security”. Read more

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Full Truck, unable to accept new customers pending the completion of the review, expected the CAC to finalize the sanctions by the end of March and hoped to continue listing in Hong Kong after that, said a source.

With limited updates from the regulator in recent weeks, however, the company does not know when it might receive the findings or possible sanctions, the person said, as other sources declined to be identified citing confidentiality constraints.

Full Truck did not respond to Reuters request for comment. The CAC also did not respond to questions sent by fax.

Formed in 2017 from a merger between two digital freight platforms Yunmanman and Huochebang, Full Truck runs a mobile app that connects truck drivers with people who need to ship items in China.

The company’s listing in Hong Kong would have added to a growing list of New York-listed Chinese companies seeking a presence on stock exchanges closer to home via a second listing amid heightened scrutiny and… stricter audit requirements from US regulators.

Amid continued weakness in shares of U.S.-listed Chinese companies, Full Truck’s stock slipped to $4.95 from $19 when it went public. Full Truck has not disclosed its intentions regarding the future of its New York listing.

Due to a longstanding Sino-U.S. audit standoff, U.S. authorities are set to expel Chinese companies from U.S. stock exchanges if the companies’ audit working papers are unavailable for inspection for three consecutive years. .

People familiar with the matter said Full Truck was unable to proceed with a Hong Kong share sale until uncertainty from the regulatory investigation surrounded the company.

The probe into Full Truck came after the cyberspace regulator launched a similar probe into Chinese ride-hailing app Didi Global Inc (DIDI.N) after it was listed in New York in June against regulators’ wishes.

Didi has also put his Hong Kong listing plan on hold indefinitely because he did not get the green light from Chinese regulators for listing, a separate source with direct knowledge said.

Didi did not respond to a request for comment.

The company previously aimed to file its listing filing in Hong Kong by the end of April and its listing by June. Read more

Didi said this month he would hold a special general meeting on May 23 to vote on his plans to delist from New York. Read more

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Reporting by Julie Zhu and Scott Murdoch in Hong Kong; Editing by Sumeet Chatterjee and Kenneth Maxwell

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