![]() |
The New York Stock Exchange is seen in this photo. AP-Yonhap |
Meihua makes successful IPO in US, first Chinese listing in months
By Kim Bo-eun
HONG KONG ― China's medical equipment maker Meihua made a successful debut on the Nasdaq in New York on Wednesday, the first Chinese initial public offering (IPO) on a U.S. market in seven months. The IPO comes after Beijing stated it is introducing tougher rules for companies seeking overseas listings.
More small companies in China's non-tech sector have made filings for listings in the U.S. Some analysts say that the firms gearing up for their IPOs in the U.S. are speeding up efforts to get listed before regulatory restrictions are clarified. But Meihua's IPO also comes at a time when U.S. and Chinese authorities are seemingly making progress in setting up a compatible regulatory framework for Chinese firms.
Uncertainty still prevails over major Chinese tech companies after the country strengthened its crackdown on platform giants, which forced ride-hailing platform Didi Chuxing to delist from the New York Stock Exchange (NYSE) last year.
China has been tightening control over big techs, punishing anti-competition practices and looking into breaches of data security. This is largely seen as an attempt to rein in the dominance of these platforms, used by the public for everything from shopping to creating videos, making payments and hailing cabs.
![]() |
Illustration of Chinese ride-hailing giant Didi Chuxing / Reuters-Yonhap |
Didi Chuxing, the No. 1 app in its category with 377 million users since absorbing Uber's business in China, had sought to raise foreign capital with its IPO in New York, as a means to expand its business overseas. But its listing on the market on June 30 that raised $4.4 billion irked Chinese authorities, as the company pushed forward despite warnings against this. This was the second-largest IPO of a Chinese firm on a U.S. stock exchange.
The Cyberspace Administration of China stated shortly after the IPO that it would launch a probe into the company's handling of data crucial to national security, and carried out the country's first cybersecurity crackdown at Didi Chuxing's office in Beijing. It blocked new users from registering and removed Didi Chuxing from app stores. The app operator stated last December that it would delist from the NYSE and seek a listing on the Hong Kong exchange.
The platform's delisting is interpreted as China's attempt to have greater control over data held by big techs, and limit the data that U.S. authorities could obtain. The data Didi Chuxing held, such as movements of passengers, was a source of concern for authorities.
The newly introduced rule states companies holding data on more than 1 million users seeking an overseas stock market debut need to receive separate approval from authorities ― a move seen as potentially barring overseas listings of tech firms.
The U.S., meanwhile, has also beefed up regulations, introducing a rule that would enable its Securities and Exchange Commission to delist foreign firms if they fail to comply with audits for three consecutive years.
These developments loom over China's online platforms Alibaba, JD.com and Pinduoduo, as well as search engine Baidu, which trade in both the U.S. and Hong Kong. Gaming and music services provider NetEase and agricultural produce commerce platform Pinduoduo trade in New York.
Some analysts said companies could follow Didi Chuxing's suit.
"It is likely many companies will move their primary listing to Hong Kong and some maybe to Shanghai or other markets. This is driven by new disclosure rules that will come in place," Herald van der Linde, head of equity strategy for Asia Pacific at HSBC Holdings, said via email.
But others highlighted progress securities authorities of the rival countries were making. A report by Reuters last month stated the China Securities and Regulatory Commission's Vice Chairman Fang Xinghai referred to such advancements.
"I believe the door will remain open for Chinese firms to list overseas," Morningstar senior equity analyst Ivan Su said in an email.