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Chinese language Tesla rival Xpeng to lift as much as $2 billion from Hong Kong itemizing

A Xpeng P7 electrical automobile is on show throughout the 18th Guangzhou Worldwide Vehicle Exhibition at China Import and Export Honest Advanced on November 20, 2020 in Guangzhou, Guangdong Province of China.

VCG | Visible China Group | Getty Photographs

GUANGZHOU, China — Chinese language electrical carmaker Xpeng will elevate as much as almost $2 billion in a Hong Kong itemizing.

The Guangzhou-based firm mentioned on Thursday it can situation 85 million Class A bizarre shares at a worth of not more than 180 Hong Kong {dollars} ($23.19) every. A last provide worth shall be set on or round Jun. 30.

On the most provide worth, Xpeng would elevate 15.three billion Hong Kong {dollars} ($1.97 billion) earlier than associated prices corresponding to underwriting charges.

CNBC reported earlier this week that Xpeng is seeking to elevate between $1 billion and $2 billion.

Xpeng is already listed in New York. Its share providing in Hong Kong is uncommon as a result of it isn’t a secondary itemizing, as firms together with Alibaba and have performed. A secondary itemizing is when an organization already has a primary itemizing location corresponding to america, and it then sells shares on one other change.

As an alternative, Xpeng is doing what’s known as a dual-primary itemizing. Meaning will probably be topic to the foundations and oversight of each U.S. and Hong Kong regulators, which is not the case with a secondary itemizing.

Relying on demand, Xpeng and its underwriting funding banks might situation extra shares, which might presumably elevate the sum of money the corporate will get from the itemizing.

Xpeng mentioned it can use the proceeds from the Hong Kong itemizing to increase its merchandise and develop extra superior applied sciences, in addition to advertising and marketing and expanded manufacturing.

Learn extra about electrical autos from CNBC Professional

U.S.-listed Chinese language firms have regarded to listing in Hong Kong as a solution to hedge in opposition to tensions between China and america.

Earlier this 12 months, U.S. Securities and Change Fee adopted guidelines that impose stricter auditing necessities on international companies listed in America. These necessities carry the specter of delisting for firms that run afoul of the foundations.

Xpeng faces rising competitors in China from different start-ups like Nio and Li Auto, in addition to Tesla and conventional automakers which might be getting into the electrical automobile market.

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