Who is Luckin chairman Charles Lu, and why is he still running the show after the company admitted to major revenue fraud?
Luckin is being investigated in the US for defrauding investors amid pressing concerns to recoup a dropoff in sales as a result of Covid-19.
Under the revised Securities Law of China, regulators may have some ability to investigate Luckin, which disclosed wide-scale sales revenue fraud.
The default followed almost immediately after Luckin disclosed that its head of operations had fabricated billions of RMB worth of sales for most of 2019.
Lawyer of these Luckin investors said it is the first time investors have tried to hold a company accountable in China for fraud perpetrated on US markets.
Luckin responded Monday to fraud allegations from an anonymous report publicized by short seller Muddy Waters on Friday.
Chinese-style noodle chain restaurants first became tech investor darlings in 2021 when the industry faced tightened regulation.
Naixue’s Tea, one of China’s largest tea beverage chains, is reportedly looking to raise $400 million in a US IPO as early as this year.
Luckin looks to fund its aggressive growth tactics including a vending machine initiative, and expansion into other consumables and overseas markets.
Luckin Coffee is offering a $400 million bond and issuing new shares less than a year after its Nasdaq IPO.