China's online grocery platform Dada enlists its initial public offering (IPO) on Nasdaq despite United States restrictions and growing tensions. The founder of the company revealed that it downplayed the impact of geopolitical tensions between the countries from its business.
Chinese online grocery delivery company Dada debuts in the New York Stock Exchange despite growing tensions between China and the US. The company enlisted its IPO with Nasdaq over the weekend.
The Walmart-invested entity enlisted lasts Friday with a value of 3.5 billion USD. Speaking at a news conference, founder and chief executive officer (CEO) of Dada Philip Kuai revealed that the company downplayed the geopolitical tensions between China and the US. He claimed that the disturbance is merely temporary. He also said that Dada remains confident that its long-term prospects can still benefit in the market, especially during the pandemic.
Kuai said that Dada is particularly welcomed scrutiny and is better at regulation observance and abides by auditing requirements. He also assured investors, users, and other market players of Dada that the entire environment of the business remains healthy since it prioritizes the interests of everyone. He also claimed that they would be better protected as the market develops more healthily nowadays.
Kuai then acknowledged that there would be an increase in regulatory requirements after the US Congress reviews the Congressional Stock Market Abuse Act of 2017. He noted that the bill puts more pressure on Chinese companies enabling them to reconsider enlisting from American stock exchanges. He said that Chinese companies such as Dada's strategic investor JD.com are even pursuing a secondary listing in Hong Kong. He said the move was to prevent the adverse effects of the bill to its company once it is approved.
Dada also warned that its listing might be delisted once the bill would be approved. The company, however, added that the legislation would not rule out its other capital market activities. Kuai then said that it is too early to afford a comment on the effect and the possibility of seeking a dual listing.
At present, the stock of Dada is valued at 16 USD per share. It offered about 20 percent more shares than initially planned last Friday. Kuai claimed that there has been a higher demand for its products and services. He noted that government stay-home orders have caused an increase in deliveries in several countries, not just in the US. Furthermore, the shares closed one percent lower after it opened the company for listing on Nasdaq.
