HONG KONG (Reuters) – China’s market regulator has begun an antitrust probe into Didi Chuxing, three people with knowledge of the matter said, just as the ride-hailing giant is pushing ahead with what could be the largest initial public offering in the United States this year.
The probe, reported here for the first time, is the latest in a sweeping crackdown on China’s so-called “platform” companies, including Alibaba (NYSE:BABA) Group Holding Ltd and Tencent Holdings (OTC:TCEHY) Ltd.
China’s market regulator, the State Administration for Market Regulation (SAMR), is investigating whether Didi used any competitive practices that squeezed out smaller rivals unfairly, two of the three sources said.
The regulator is also examining whether the pricing mechanism used by Didi’s core ride-hailing business is transparent enough, the three sources said.
The U.S. firm currently owns 12.8% stake in Didi, according to the Chinese company’s prospectus. Some of Asia’s largest technology investment firms, including SoftBank Group Corp, Alibaba and Tencent, are also invested in Didi.