China’s Xpeng Motors To Raise Up To $ 2 Billion In Hong Kong IPO – .

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China’s Xpeng Motors To Raise Up To $ 2 Billion In Hong Kong IPO – .


An XPeng Motor P7 electric vehicle is on display for sale at Wanda Plaza on May 9, 2021 in Beijing, China.
VCG | Getty Images
GUANGZHOU, China – Chinese electric car maker Xpeng Motors, listed in the United States, has been given the green light to conduct an IPO in Hong Kong that could bring in between $ 1 billion and $ 2 billion, a CNBC told CNBC source close to the file.
This comes as the Chinese electric vehicle market becomes increasingly competitive.

Hong Kong Exchanges and Clearing’s rating committee gave Xpeng the green light, added the source, who was not authorized to speak publicly on the case.

Xpeng is already listed in New York. The initial Hong Kong public offering will be slightly unusual.

While Chinese companies already listed in the United States, such as Alibaba and JD.com, have come to Hong Kong to perform so-called secondary listings, Xpeng will conduct a dual primary listing.

This means that it will be subject to the rules and oversight of US and Hong Kong regulators, which is not the case with a secondary listing.

But it will also mean that the Guangzhou-based electric car maker will be part of the “Stock Connect” program that allows investors from mainland China to buy shares in the company. This could potentially increase its pool of investors.
JPMorgan Chase and BOFA will be the main banks facilitating the listing, the source said.

Xpeng Motors declined to comment when contacted by CNBC.

Hong Kong fundraising plans come as US-China tensions continue to threaten companies listed on Wall Street. The United States Securities and Exchange Commission passed rules earlier this year that place stricter audit requirements on foreign companies listed in America. It carries the threat of delisting for companies that do not comply.

But Xpeng is also raising money as it seeks to compete in an increasingly crowded electric car market in China. Not only is it up against mainstream automakers looking to increase their electric car market share, but it is also up against market leader Tesla and local start-ups like Nio and Li Auto. The latter two are also listed in the United States

Xpeng said it delivered 5,686 cars in May, an increase of 483% year-on-year and a 10% increase from the previous month, at a faster pace than in April. The company aims to deliver between 15,500 and 16,000 units in the second quarter.

In April, Xpeng launched the P5, its third production model and its second sedan after the P7. The company is focused on strengthening its technology, including certain autonomous driving features, to differentiate itself from its competitors.

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