: Nio denies report of capital raise, and stock pares losses

by | Sep 25, 2023 | Stock Market

Nio Inc. denied “media speculations” that it was considering another capital raise, but the stock still sank to the lowest prices seen in more than three months. Bloomberg reported on Monday, citing people familiar with the matter, that the China-based electric-vehicle maker
is considering raising about $3 billion from investors.

That capital raise would be in addition to the $1 billon convertible-debt offering that closed on Monday and would come a couple of months after Nio closed a $738.5 million equity investment from CYVN Holdings LLC, which is controlled by the Abu Dhabi government. Also read: Nio’s stock drops after losses widen and revenue falls more than forecast. After the Bloomberg report, Nio’s stock dropped as much as 7% to an intraday low of $7.93, the lowest price seen since June 9, before paring losses to be down 2.8% in morning trading following the company’s denial. “The company has been made aware of certain media speculations claiming that the company is considering raising certain capital from investors, which have been widely circulated today,” Nio said in a statement posted on its website. “In light of the unusual market activity in the company’s American depositary shares today, the company would like to clarify that the company currently has no reportable capital raising activity, other than the recent convertible notes offering that was completed on September 25, 2023.” Nio’s stock has plunged 46.4% since peaking at a 10-month closing high of $15.46 on Aug. 3 and has lost 15% year to date, while shares of fellow China-based EV makers Li Auto Inc.
have soared 75.3% this year and shares of XPeng Inc.

have run up 65.2%. Meanwhile, the iShares MSCI China exchange-traded fund
has declined 8.8% this year and the S&P 500 index
has gained 12.4%.

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