Beijing's Anti-Business Crackdown Hampered The Semiconductor Giant's IPO.
Key Sentence:
- Chinese electric car maker BYD plans to sell a stake in its computer chip manufacturing unit.
- The Unit has been scrapped as its latest share offering will be affected by Beijing's crackdown.
The announcement has been halted due to a regulatory investigation by the law firm advising the company.
The Nasdaq Shenzen ChiNext style roster plan was presented in May.
The shutdown comes amid broader industry regulation by Chinese authorities. Over the weekend, the Shenzhen Stock Exchange announced that law firm Beijing Tian Yuan, one of China's most prominent legal services firms, was under investigation for listing.
The company, which advice on BYD Semiconductor's planned IPO, is under investigation by China's Security Regulatory Commission but has not released further details.
BYD Semiconductor wants to raise at least $421 million ($309 million) through a stock sale. He plans to put the money back in business as global automakers grapple with a shortage of computer chips.
Microcontrollers are essential components in modern cars and are used for everything from seats and windows to steering and anti-lock brakes. BYD Semiconductor competes directly with major chip manufacturers, including Germany's Infineon and Japan's Rohm Semiconductor.
According to market estimates, BYD is China's largest automaker and is backed by veteran US investor Warren Buffett. BYD is the latest Chinese company with final plans as Beijing tightens regulations on everything from tech giants to insurance companies.
New data protection law
Beijing introduced data protection, and China's highest legislature, the Standing Committee of the National People's Congress, passed an extensive new data protection law on Friday. The Personal Data Protection Act aims to strictly control data collection by technology companies and came into effect on November 1.
Several technology companies in China are facing privacy concerns.
Earlier this year, the country's Internet regulator ordered online stores not to offer Didi's app for illegally collecting users' data. It comes just two days after the company debuted on the New York Stock Exchange, and the stock fell sharply on the news.