April 22, 2022
– US delistings
What does it cost for US listed Chinese companies seeking to trade shares in Hong Kong? Quora-like Zhihu a fifth fall on his Asian debut shows that it can get loud. The $ 1 billion online Q&A forum is the latest in a steady stream of Chinese companies with Big Board seats seeking an escape route if Washington moves forward with plans to oust companies from New York if their watchdogs can not inspect their accountants – something Beijing has long resisted.
Zhihu, who flew to New York in March last year, was the first such outfit to raise no new funds through his Hong Kong homecoming. Trades that consist solely of existing stocks tend to fall badly, especially when the remaining stock of sellers creates an overhang, as this does. Zhihu’s US shares have fallen by a third since launching sales in Hong Kong, bringing the market value below its $ 1.1 billion mark. Its Hong Kong experience raises questions about the escape plans of other money-rich Chinese companies in New York. The answers will probably be just as expensive. (By Jennifer Hughes)
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