Chinese electric car maker aims to raise up to $950m in growth push

Electric vehicle maker Li Auto’s US listing will provide the latest gauge of American investor demand for Chinese companies going public. (Reuters)
Short Url
Updated 26 July 2020

Chinese electric car maker aims to raise up to $950m in growth push

  • Li Auto creates sparks with major US listing amid claims rival Xpeng also plans to go public in New York

HONG KONG: Chinese electric vehicle maker Li Auto Inc, backed by food delivery giant Meituan Dianping, has launched an initial public offering of up to $950 million, in one of the biggest US listings by Chinese companies this year.

The five-year-old automaker, formerly known as CHJ Automotive, is selling 95 million American depositary shares (ADDS) at an indicative range of $8 to $10 per share, according to its updated prospectus filed with the US Securities and Exchange Commission on Friday.

Each ADS represents two Class A ordinary shares.

Private equity firm Hillhouse Capital plans to invest $300 million in the float, the company said in the filing.

The IPO is the latest gauge of US investor demand for Chinese companies going public.

For Li Auto and some other companies, prestige and listed comparables continue to propel them toward a US listing in spite of escalating Sino-US geopolitical tension and negative sentiment toward Chinese firms following widespread fallout from Luckin Coffee.

Li Auto’s rival, Xpeng, plans to go public in New York later this year, according to sources with knowledge of the matter.

At $950 million, Li Auto’s IPO would surpass the $510 million float by cloud service provider Kingsoft Cloud, the biggest US listing by a Chinese firm this year.

Alongside the IPO, Li Auto will also raise $380 million from a concurrent private placement of shares to investors including Meituan Dianping via its British Virgin Islands-incorporated unit, and TikTok owner ByteDance via a Hong Kong unit.

The automaker plans to use most of the proceeds raised for capital expenditures, and research and development of new products. It is building Li ONE extended-range electric sport-utility vehicles in China.

It is set to price the float on July 30 and begin trading on the Nasdaq under the symbol “Li” the next day.

Goldman Sachs, Morgan Stanley, UBS and CICC are among underwriters for the IPO.


Lebanon plunged into ‘deliberate depression’: World Bank

Updated 01 December 2020

Lebanon plunged into ‘deliberate depression’: World Bank

  • The fall 2020 edition of the Lebanon Economic Monitor predicted the economy will have contracted by 19.2 percent this year
  • Lebanon’s economy started collapsing last year as a result of years of corrupt practices and mismanagement

BEIRUT: Lebanon’s economy is sinking into a “deliberate depression,” the World Bank said Tuesday in a damning report stressing the authorities’ failure to tackle the crisis.
The fall 2020 edition of the Lebanon Economic Monitor predicted the economy will have contracted by 19.2 percent this year and projected a debt-to-GDP ratio of 194 percent next year.
“A year into Lebanon’s severe economic crisis, deliberate lack of effective policy action by authorities has subjected the economy to an arduous and prolonged depression,” a World Bank statement said.
Lebanon’s economy started collapsing last year as a result of years of corrupt practices and mismanagement.
The crisis was made worse by a nationwide wave of anti-government protests that paralyzed the country late last year and the Covid-19 pandemic this year.
The August 4 Beirut port blast, one of the largest non-nuclear explosions in history, brought the country to its knees and further fueled public distrust.
“Lebanon is suffering from a dangerous depletion of resources, including human capital, with brain drain becoming an increasingly desperate option,” the World Bank warned.
In 2020, Lebanon defaulted on its debt, banks imposed capital controls and inflation has reached triple-digit rates, dragging the country into its worst ever economic crisis.
Instead of taking emergency measures to rescue the economy, Lebanon’s political elite has continued to dither and bicker.
The previous government headed by Hassan Diab failed to adopt ambitious policies to tackle the crisis. It resigned under pressure over the blast nearly four months ago and a new cabinet has yet to be formed.
“Lack of political consensus on national priorities severely impedes Lebanon’s ability to implement long-term and visionary development policies,” said Saroj Kumar Jha, World Bank regional director.
He called for the quick formation of a new government capable of implementing short-term emergency measures and addressing long-term structural challenges.
“This is imperative to restore the confidence of the people of Lebanon,” he said.
An annual index compiled by Gallup that tracks people’s experience of stress and sadness said “no other country in the world saw negative experiences skyrocket across the board as much as Lebanon.”
The Negative Experience Index’s data was collected before the Beirut port blast, Lebanon’s worst ever peace time disaster.