NIO announced the biggest US fundraising plan by a Chinese company since Didi’s ill-fated initial public offering (IPO), causing its value to drop the furthest in almost three weeks, reports Bloomberg. Shares in the electric carmaker fell as much as 6.3% on Wednesday after it unveiled plans to sell up to $2 billion of American depositary shares, which would boost its cash holdings amid supply-chain disruptions and ahead of its planned Hong Kong listing.
The company’s plan for an at-the-market offering adds to a flagship year for such deals. Unlike traditional stock offerings that cater to institutional investors in one large transaction, these plans let companies sell shares in the open market over time.
If completed, NIO’s deal would be the biggest US equity offering by a Chinese firm since Didi’s now-infamous IPO in June. US stock sales by companies based in China have dwindled since the ride-hailing company’s debut sparked a regulatory crackdown that weighed on investor sentiment, sending the Nasdaq Golden Dragon China Index down by over 30%.