Nio, a Chinese electric car-maker listed on the New York Stock Exchange (NYSE), is said to be exploring a listing on the Singapore Exchange (SGX) instead of an earlier plan of floating shares in Hong Kong amid uncertainties over local regulatory scrutiny.
Nio recently held a meeting to discuss the potential of a secondary listing in Singapore, according to International Financing Review (IFR), Refinitiv’s capital markets news service, citing sources. One source said that Nio did not completely scrap the listing plan in Hong Kong and would continue discussions with the local regulators.
Nio did not immediately respond to DealStreetAsia’s request for comments.
While the firm is yet to announce the details of the listing plan, Nio is likely to sell a stake of about 5%, which would allow it to raise approximately $1.8 billion based on the firm’s market capitalisation of $36.8 billion on Friday.
One of Tesla’s challengers in China, Nio had filed a preliminary prospectus to list in Hong Kong in March 2021. But a Bloomberg report later in September cited sources saying that the secondary listing was delayed amid the Hong Kong stock exchange’s queries about aspects of its structure, including a user trust set up in 2019.
In his attempt to build a “user enterprise,” Nio’s founder and CEO William Li in 2019 had transferred 50 million shares to a Nio User Trust to let customers “have the opportunity to discuss and propose the use of the economic benefits from the transferred shares,” according to a company filing at the time. Li retains voting rights over the shares.
Nio is among the handful of US-traded Chinese electric vehicle (EV) startups looking for a public listing elsewhere, as their listing status faces increasing uncertainties amid Beijing’s expanded tech crackdown and tightened oversight of overseas listings of domestic businesses.
Alibaba-backed Xpeng, which had raised about $1.5 billion on the NYSE in 2020, was the first Chinese EV maker to complete a so-called homecoming share sale in Hong Kong last July, pocketing $1.8 billion. One month later, Li Auto, a six-year-old EV startup that had completed a $1.09-billion Nasdaq IPO in 2020, raised over $1.5 billion in a dual primary listing in Hong Kong.