Struggling Chinese electric carmaker Nio seeks US$344 million through sale of new American depositary shares
- The New York-listed electric vehicle maker will offer 60 million new shares, as coronavirus and increased competition heighten fundraising needs
- Fundraising comes just two months after new strategic investors agreed to inject 7 billion yuan of cash into the business
Cash-strapped Chinese electric car maker Nio said it expects to raise up to US$344.2 million from a new share sale of 60 million American depositary receipts (ADRs).
This would be its first offering of shares since it listed in New York in September 2018.
Nio said in a prospectus that the estimate was based on its last closing price on June 8, at US$5.97.
The loss-making company, founded in 2014, said it would use the proceeds to fund research and development, expand its manufacturing base, and develop its sales and servicing network.
There is an overallotment option for the underwriters to buy nine million more ADRs within a 30-day period if the share sale raises strong demand from investors.
Credit Suisse, Morgan Stanley and CICC are the joint bookrunners for the deal. The final pricing for the ADRs will be determined after the New York stock market closes on Wednesday. Nio’s stock reached a 12-month high of US$6.68 on Tuesday. The 60 million shares work out to about 7 per cent of its existing share capital.