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• Nio will neither issue new shares nor raise additional capital
• The shares will begin trading under the stock code 9866
• The company's market value is almost $34 billion as of Friday
Nio Inc (NIO) , a Chinese electric car startup said Monday that it proposed a secondary listing of its Class A ordinary shares in the Hong Kong stock market.
The Shanghai-based firm announced that it has acquired in-principal clearance from the Hong Kong stock market to list its shares “by way of introduction”, which means it would neither issue new shares nor raise additional capital.
NIO has also registered for a secondary listing in Singapore but said that it would continue to primarily list and trade its American depositary shares on the NYSE.
On March 10, 2022, the shares are planned to begin trading on the SEHK's Main Board under the stock code "9866,” and will be traded in 10-share board lots.
The value of the company's U.S.-listed depositary receipts has dropped by more than half in the last year. According to FactSet, Nio had a market value of almost $34 billion as of Friday.
Bloomberg earlier reported that Nio wanted to list in Hong Kong last year but encountered objections from authorities about its business structure, which included a "users trust."
As Washington seeks to restrict U.S. investors' exposure to enterprises that do not comply with US audit requirements, Chinese companies are increasingly at risk of being delisted from New York exchanges. Due to the risk of sensitive information being released, Beijing has resisted permitting such outside examination of local enterprises, CNBC stated.
Didi Global Inc. (NYSE: DIDI), a Chinese ride-hailing startup, is also looking to list in Hong Kong as it moves to delist from the US after running afoul of Chinese regulators.
Read more: China introduces new rule for some firms to undergo cybersecurity review before overseas listings
Li Auto In (NASDAQ: LI) and Xpeng Inc (NYSE: XPEV), two other U.S.-listed Chinese electric car businesses, completed "dual primary listings" in Hong Kong last summer.
Picture Credits: CNN