KE Holdings Inc. Updates the Status under Holding Foreign Companies Accountable Act

Rhea-AI Summary

KE Holdings Inc. (NYSE: BEKE) has been identified by the SEC under the Holding Foreign Companies Accountable Act (HFCAA) since April 21, 2022, due to the inability of the PCAOB to inspect its auditor's work papers for the fiscal year ended December 31, 2021. If this designation continues for three consecutive years, trading of its shares on U.S. exchanges may be prohibited. The company is actively seeking solutions to protect stakeholder interests while complying with regulations in China and the U.S., with a focus on maintaining its NYSE listing.

Positive

• The company is actively exploring solutions to protect stakeholder interests.
• Continued compliance with applicable laws and regulations in both China and the U.S.

Negative

• Identification under the HFCAA raises concerns about the company's ability to remain listed on U.S. exchanges.
• If the SEC continues the designation for three years, BEKE may face trading prohibitions in the U.S.

BEIJING--(BUSINESS WIRE)-- KE Holdings Inc. (“Beike” or the “Company”) (NYSE: BEKE), a leading integrated online and offline platform for housing transactions and services, today updates its status under the Holding Foreign Companies Accountable Act (the "HFCAA").

The Company is aware of the fact that it was identified by the United States Securities and Exchange Commission (the "SEC") under the HFCAA on April 21, 2022. The Company understands that this identification under the HFCAA and its implementation rules issued thereunder indicates that the SEC determines the Company used a registered public accounting firm whose working paper cannot be inspected or investigated completely by the Public Company Accounting Oversight Board of the United States (the "PCAOB") to issue the audit opinion for its financial statements for the fiscal year ended December 31, 2021.

In accordance with the HFCAA, the SEC shall prohibit a company’s shares or American depositary shares from being traded on a U.S. stock exchange or in the over-the-counter trading market in the United States if the company has been identified by the SEC for three consecutive years due to the PCAOB's inability to inspect the registered public accounting firm’s working paper related to such company.

The Company has been actively exploring possible solutions to protect the interest of its stakeholders. The Company will continue to comply with applicable laws and regulations in both China and the U.S., and strive to maintain its listing status on the New York Stock Exchange.

About KE Holdings Inc.

KE Holdings Inc. is a leading integrated online and offline platform for housing transactions and services. The Company is a pioneer in building the industry infrastructure and standards in China to reinvent how service providers and housing customers efficiently navigate and consummate housing transactions, ranging from existing and new home sales, home rentals, to home renovation and furnishing, and other services. The Company owns and operates Lianjia, China’s leading real estate brokerage brand and an integral part of its Beike platform. With more than 20 years of operating experience through Lianjia since its inception in 2001, the Company believes the success and proven track record of Lianjia pave the way for it to build the industry infrastructure and standards and drive the rapid and sustainable growth of Beike.

Safe Harbor Statement

This press release contains statements that may constitute “forward-looking” statements pursuant to the “safe harbor” provisions of the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by terminology such as “will,” “expects,” “anticipates,” “aims,” “future,” “intends,” “plans,” “believes,” “estimates,” “likely to,” and similar statements. Among other things, the business outlook and quotations from management in this press release, as well as Beike’s strategic and operational plans, contain forward-looking statements. Beike may also make written or oral forward-looking statements in its periodic reports to the U.S. Securities and Exchange Commission (the “SEC”), in its annual report to shareholders, in press releases and other written materials and in oral statements made by its officers, directors or employees to third parties. Statements that are not historical facts, including statements about KE Holdings Inc.’s beliefs, plans, and expectations, are forward-looking statements. Forward-looking statements involve inherent risks and uncertainties. A number of factors could cause actual results to differ materially from those contained in any forward-looking statement, including but not limited to the following: Beike’s goals and strategies; Beike’s future business development, financial condition and results of operations; expected changes in the Company’s revenues, costs or expenditures; Beike’s ability to empower services and facilitate transactions on Beike’s platform; competition in our industry; relevant government policies and regulations relating to our industry; Beike’s ability to protect the Company’s systems and infrastructures from cyber-attacks; Beike’s dependence on the integrity of brokerage brands, stores and agents on the Company’s platform; general economic and business conditions in China and globally; and assumptions underlying or related to any of the foregoing. Further information regarding these and other risks is included in KE Holdings Inc.’s filings with the SEC. All information provided in this press release is as of the date of this press release, and KE Holdings Inc. does not undertake any obligation to update any forward-looking statement, except as required under applicable law.

View source version on businesswire.com: https://www.businesswire.com/news/home/20220421006187/en/

For investor and media inquiries, please contact:

In China:

KE Holdings Inc.

Investor Relations

Matthew Zhao

Siting Li

E-mail: ir@ke.com

The Piacente Group, Inc.

Yang Song

Tel: +86-10-6508-0677

E-mail: ke@tpg-ir.com

In the United States:

The Piacente Group, Inc.

Brandi Piacente

Tel: +1-212-481-2050

E-mail: ke@tpg-ir.com

Source: KE Holdings Inc.

FAQ

What does the SEC's identification under the HFCAA mean for BEKE?

It indicates that the SEC could prohibit BEKE's shares from being traded on U.S. exchanges if the situation continues for three consecutive years.

When was BEKE identified under the HFCAA?

BEKE was identified under the HFCAA on April 21, 2022.

What steps is BEKE taking to address the SEC's concerns?

BEKE is exploring possible solutions to protect stakeholder interests and is committed to complying with laws in China and the U.S.

What could happen if BEKE fails to resolve its HFCAA designation?

BEKE could face a prohibition on trading its shares on U.S. markets if the designation is extended for three consecutive years.

What financial year is impacted by the SEC's identification of BEKE?

The financial year impacted is the fiscal year ending December 31, 2021.