Chinese regulators forced Tencent’s WeChat messaging service and Ant Group’s Alipay to remove Didi from its app interface and rendered Didi no longer searchable in app stores in the country, CNBC reported on Wednesday (July 7).
Through the super apps, WeChat and AliPay users were able to open the ride-hailing giant Didi’s app while on either service, according to the article. WeChat and AliPay are seen as being important inroads to other services without the need to download a separate app. WeChat has an estimated 1 billion users and AliPay has 900-plus million customers.
The Chinese ride-hailing startup is already being investigated by regulators in China in a cybersecurity review. These setbacks are taking place in the midst of Didi’s planned $4.4 billion U.S. initial public offering (IPO) that puts the valuation of the company at over $67 billion.
The Beijing-based platform posted a quarterly profit of an estimated $800 million in the first three months of 2021. Didi has market dominance in China’s ride-hailing space.
The timing of the probe into Didi by the Cyberspace Administration of China is reminiscent of the halting of Ant Group’s public offering planned last fall. So far, there has not been an edict to halt the company’s U.S. IPO. The crackdown comes while almost 250 different Chinese companies are now trading on U.S. exchanges.
News of the investigations from Chinese officials prompted Didi to forewarn investors on Monday (July 5) that a revenue drop was likely to happen. The question of supreme authority over user data is seen as being the motivation for the probes.