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ByteDance, the Chinese owner of short-form video app TikTok, has put on hold, indefinitely, plans for an initial public offering in the U.S. or Hong Kong after government officials in China warned management to address data security risks, the Wall Street Journal reported on Monday, citing people familiar with the situation.
The Beijing-based company was valued at $180 billion in a round of funding in December. According to the paper, founder Zhang Yiming decided to put the IPO considerations on ice after meetings with regulators. It also cited a person close to the firm as noting that ByteDance didn’t have a CFO at the time of the decision.
The TikTok owner’s cautious approach comes in contrast to Chinese ride-hailing company Didi Global, which went ahead with a U.S. listing in late June that raised $4.4 billion despite suggestions from Chinese regulators not to do so amid worries that some of its data could fall into foreign hands, the Journal reported. Didi has since had its main app and others it operates ordered removed from Chinese app stores.
The Chinese authorities have been getting tougher on technology firms in terms of enforcement since late 2020, with the Journal highlighting “a sweeping antimonopoly crackdown and new rules to govern data collection and cybersecurity practices.”
Shares of Kuaishou Technology, China’s second-most popular short-form video app behind TikTok, jumped nearly 300 percent in their February debut on the Hong Kong stock exchange.
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