Baidu is one of the earliest Chinese companies listed in the United States.
On the evening of May 21, Reuters quoted three sources as saying that Baidu is considering delisting from Nasdaq to improve valuation; the discussion is still in the early stages.
Baidu asked Baidu for verification of the news. Baidu responded that it would not comment.
The source revealed that Baidu is considering delisting from the US Nasdaq because of growing investment tensions between China and the United States. Baidu is contacting some reliable consultants to find the best way to deal with issues including funding and any regulatory response.
On May 20th local time, the US Senate passed the Foreign Company Accountability Act. The bill stipulates that any foreign company that fails to comply with the audit requirements of the PCAOB will be prohibited from listing in the United States. The bill also requires listed companies to disclose whether they are owned or controlled by foreign governments.
Some requirements in this bill conflict with China ’s current cross-border securities audit regulations. Regulatory documents show that cross-border securities supervision matters should be conducted through the China Securities Regulatory Commission. Without the consent of relevant departments, no unit or individual can directly provide audit papers overseas. This means that the current conflict may increase the delisting risk of Chinese companies listed in the United States.
According to China Daily, on the morning of May 21st, Li Yanhong, member of the National Committee of the Chinese People ’s Political Consultative Conference and chairman of Baidu, tightened the supervision and review of the US listed companies He responded by saying: “We are indeed very concerned about the continued tightening of controls on the Chinese stock companies from the government level. We are constantly discussing what we can do internally, including secondary listings in Hong Kong and other places. “
In addition, sources disclosed to Reuters that Baidu believes that its value on the Nasdaq exchange is underestimated. Baidu ’s share price has fallen by more than 60% since its May 2018 peak, while the Nasdaq Golden Dragon China Index (HXC), which tracks the performance of Chinese companies listed in the US, has fallen Less than 10%.
As of press time, Baidu fell 1.46% to US $ 106.94.