After almost 20 years of Chinese tech firms listing in the US stock market, Chinese authorities appear to have stopped the process behind companies worth $2 trillion.
- China’s July 10 announcement requiring all businesses trying to list in overseas stock markets will require approval from empowered cybersecurity regulators amounts to significant death for Chinese IPs in the U.S.
- Paul Gillis, a professor at Peking University in Beijing stated that it is unlikely there will be a U.S.-listed Chinese firm in 5 to 10 years, other than a few secondary listings.
- The suppression, pushed by Didi’s decision to move ahead with US listing despite objections from regulators is already sending tremors through markets.
- An index of U.S.-traded tech stocks dropped 30% from a record high. Wall Street firms are bracing for lucrative underwriting fees.
China is taking radical steps to modernize their stock markets to enable Chinese tech firms to list at home, and be less dependent on U.S. capital markets.
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Source: Bloomberg.
