Didi takes $22 billion hit in market value following China’s stern stance

Chinese-based ridesharing company Didi has plunged in premarket trading after a Chinese regulator ordered the removal of the company’s platform from app stores.

The stern stance comes days after a $4.4 billion initial public offering in the U.S.

Shares of the tech firm fell as much as 30% – wiping out around $22 billion of market value and taking the stock below the $14 IPO price.

The Cyberspace Administration of China barred new users from Didi’s app, citing security risks and tightening its grip on sensitive online data.

Didi responded to the crackdown and stated that its business model would ‘greatly suffer’

While Didi’s half-billion existing users will still be able to order rides, for now, China’s cybersecurity crackdown adds to the uncertainty surrounding all the nation’s internet companies. 

Chinese regulators asked Didi as early as three months ago to delay its landmark U.S. IPO because of national security concerns involving its huge trove of data, according to people familiar with the matter.