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Thread: Didi co-founder Liu told associates she plans to leave: Report

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    Default Didi co-founder Liu told associates she plans to leave: Report

    Didi co-founder Liu told associates she plans to leave: Report

    20 Sep 2021

    HONG KONG/SHANGHAI: Didi Global co-founder and President Jean Liu has told some close associates that she intends to step down, two sources familiar with the matter said, as the Chinese ride-hailing giant faces intense regulatory scrutiny following its New York listing earlier this year.

    Liu, 43, has in recent weeks told some associates that she expected the government to eventually take control of Didi and appoint new management, said the two sources.

    Liu, a former Goldman Sachs Group Inc banker, told a couple of executives close to her in recent weeks - including those who had followed her to join Didi from the Wall Street bank - that she planned to leave and encouraged them to start looking for new opportunities as well, said one of the sources who was briefed on the matter.

    Some of those executives have since approached industry contacts for job leads, the source said.

    Reuters was unable to learn further details, including whether Liu had submitted a formal resignation letter or set a date to leave.

    Didi said it is "actively and fully cooperating with the cybersecurity review. Reuters' rumours about management changes are untrue and unsubstantiated."

    Liu did not respond to Reuters request for comment sent via the company spokespersons.

    Didi’s shares were recently down nearly 5 per cent in US trading on Monday. The benchmark S&P 500 index was recently off around 1.7 per cent in a broader selloff fuelled by worries over heavily indebted Chinese property company Evergrande.

    Didi, sometimes dubbed the Uber of China, has come under intense scrutiny since early July by Chinese authorities over its collection and use of personal data of users of its service, pricing mechanisms and competitive practices.

    Officials have launched a broad crackdown on private companies, including those in the tech sector, to control big data and break down monopolistic practices.

    Billionaires minted by high-profile listings, such as Didi's US$4.4 billion debut, have fallen out of favor as President Xi Jinping warns against the country's vast income inequality.

    Didi ran afoul of the powerful Cyberspace Administration of China (CAC) when it pressed ahead with its debut on Jun 30, despite the regulator urging the company to put it on hold while it conducted a cybersecurity review of its data practices, according to people with knowledge of the matter.

    Soon after the listing, the CAC announced an investigation into Didi and subsequently ordered the removal of its apps for download in China. Officials from at least six other departments also got involved.

    Reuters could not learn whether regulators had asked for Liu's departure and what would happen to other executives, such as Didi Chairman and CEO Will Cheng.

    One of the sources familiar with Liu's plans said the Harvard alumni and daughter of Lenovo Group founder Liu Chuanzhi had also talked about leaving Didi in the years before the current regulatory crisis to try her hand at something new.

    CAC did not respond to Reuters request for comment, while Didi did not respond to specific questions.

    Liu joined Didi in 2014. She holds a 1.6 per cent stake, worth around US$640 million currently, in the company and controls 23 per cent of the vote, thanks to a dual-class share structure, according to the company's prospectus.

    She has been deeply involved in the company's key corporate financial decisions, including its merger with Alibaba Group Holding Ltd-backed Kuaidi in 2015, takeover of Uber Technologies's China business and fundraising from investors including Apple.

    Liu also oversees Didi's other corporate matters including human resources and represents the company in external communications especially during crises.

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    Default Re: Didi co-founder Liu told associates she plans to leave: Report

    “Reuters’ Rumors About Management Changes Are Untrue And Unsubstantiated” – DiDi Global

    Sep 20, 2021

    Russell Flannery
    Forbes Staff
    Asia


    DiDi Global President Jean Liu in 2018. (Photo by Tomohiro Ohsumi/Getty Images) Getty Images

    China ride-sharing app DiDi Global this morning responded to a Reuters report that President Jean Liu plans to leave the company, saying: “Reuters' rumors about management changes are untrue and unsubstantiated.”

    “We strongly condemn those malicious and repeated rumors fabricated and distributed on certain media against DiDi, and reserve all rights to pursue legal actions against such acts of infringement,” DiDi said in a statement distributed by PR firm SVC.

    Liu “has told some close associates that she intends to step down,” Reuters reported yesterday, citing two sources familiar the matter. The executive has also “in recent weeks told some associates that she expected the government to eventually take control of Didi and appoint new management,” the two sources said, according to Reuters.

    DiDi lost 6.6% in New York trading on Monday after the report, and ended 45% below its June IPO price of $14 a share.

    The company faces regulatory probes in China and class-action lawsuits in connection with its listing in New York. Its app was banned from the app store in China days after the listing.

    “DiDi is actively and fully cooperating with the cybersecurity review,” the statement said.

    Liu is the daughter of China computer industry pioneer Liu Chuanzhi and once worked at Goldman. DiDi investors include Softbank New Vision Fund, which holds a 20% stake, Uber 12%, and Tencent 6%, according to the company’s prospectus.

    Chairman Cheng Wei, 38, who holds an approximately 6.5% stake, holds a fortune worth $2.4 billion, according to today’s Forbes Real-Time Rich List.

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