Chinese electric vehicle (EV) maker Nio Inc (蔚來汽車) is to start trading on the Hong Kong stock exchange next week, choosing a path to listing that does not involve selling new shares or raising any money.
The Shanghai-based automaker has applied for a secondary listing of its Class A ordinary shares on the Hong Kong exchange by way of introduction, it said in a statement.
Trading is expected to start on Thursday next week, subject to final approval from regulators.
The company initially filed for a Hong Kong listing in March last year, but that was delayed amid regulatory concerns about aspects of its structure, Bloomberg News reported last year.
In 2019, chief executive officer William Li (李斌) transferred 50 million company shares to a Nio User Trust, although he retained voting rights over the shares.
The move completes a homecoming of sorts by all three US-traded Chinese EV manufacturers — Nio, Xpeng Inc (小鵬汽車) and Li Auto Inc (理想汽車) — after the latter pair listed on the Hong Kong exchange last year.
A second listing in Hong Kong provides a hedge against the risk of being delisted from US exchanges.
However, unlike its rivals, Nio chose to list by way of introduction — an easier way for a company already listed elsewhere to join the Hong Kong market.
Nio will not sell shares or raise new funding, so it will not incur additional listing expenses, according to the exchange’s Web site.
Xpeng raised about US$2 billion in its Hong Kong listing, while Li Auto raised about US$1.7 billion.
With its Hong Kong listing delayed, Nio in September raised US$2 billion in American depositary receipts.
To facilitate trading in Hong Kong, Tencent Holdings Ltd (騰訊) — an early investor in the EV company — is to lend 41.4 million Class A shares, or about 2.7 percent of the stock on issue, to designated dealers to make available to buyers.
Separately, Nio said it has also applied for a secondary listing by way of introduction on the Singapore stock exchange, and the application is under review.
Listing in Hong Kong and Singapore would widen Nio’s financing options, mitigate political risk and allow the company to connect more deeply with Asian investors, a Citigroup note said.
Founded in 2014, Nio has recovered from a near-death experience to gain a solid foothold in China’s burgeoning EV market, delivering 91,429 cars last year.
Its American depositary receipts will continue to be primarily listed and traded on the New York Stock Exchange.
Nio’s US-traded shares have slumped 34 percent this year.
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