Electric vehicle maker Nio could raise as much as $1.3 billion from its newly announced equity offering, according to a prospectus supplement filed with the SEC on Wednesday.
The filing confirmed the offering size of up to 181.8 million Class A ordinary shares, split between American depositary shares listed in New York and ordinary shares listed in Hong Kong and Singapore.
Based on the latest closing prices cited in the filing — $6.17 per ADS in New York, HK$47.18 ($6.01) in Hong Kong and $6.02 in Singapore on September 8 — the deal would generate gross proceeds of about $1.1 billion.
If underwriters exercise their 30-day option to purchase an additional 27.3 million ADSs, proceeds could rise to between $1.26 billion and $1.29 billion, depending on the market allocation.
The capital raise comes a week after management set its fourth quarter goal of selling 50,000 vehicles a month across Nio, Firefly and Onvo.
The current record, set last month, is about 31,300.
Nio said it intends to use the funds for research and development of EV technologies, to expand its lineup across its three brands, to grow its battery swapping and charging network, and to strengthen its balance sheet.
The prospectus added new details beyond the company’s press release earlier in the day.
It disclosed that Nio, its directors and executives have agreed not to sell or transfer shares for 90 days following the offering, except under limited circumstances.
It also noted that underwriters may engage in stabilization transactions and short sales to support trading after the offering.
Morgan Stanley Asia Limited, UBS Securities LLC, UBS AG Hong Kong Branch and Deutsche Bank AG Hong Kong Branch are acting as joint underwriters.
Nio’s ADSs closed at $6.17 in New York on Monday (Sept. 8), the day before the filing’s reference date and at $6.28 on Tuesday.
As of press time, the US-listed shares are falling 8.60% on Wednesday’s pre-market trading session to $5.74.
Singapore-listed shares were suspended earlier this Wednesday pending the release of an announcement leading to a 5% decline on the US-listed shares during the first minutes of the pre-market session.
The request for suspension came from Chief Financial Officer Stanley Qu.
