U.S. relisting for Luckin would be hard to swallow

Luckin Coffee

21/01/2022 03:10

(The author is a Reuters Breakingviews columnist.  The opinions
expressed are his own.)
    By Pete Sweeney
    HONG KONG, Jan 21 (Reuters Breakingviews) - China’s would-be
challenger to Starbucks may be plotting a market comeback after
$300 mln in fake sales got it booted from Nasdaq. It has
restructured and is moving towards profitability, but otherwise
is covered with red flags. Even floating on a local bourse would
be ambitious.
    Full view will be published shortly.
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    CONTEXT NEWS
    - Luckin Coffee is exploring plans to relist in the United
States, the Financial Times reported on Jan. 20, citing unnamed
sources. 
    - The Chinese company, once valued at $13 billion, on April
2, 2020, formed a special board committee to investigate
potential accounting fraud. Its shares were suspended in June
2020, and were subsequently delisted by the Nasdaq Stock Market.
    - Luckin agreed on Dec. 16, 2020, to pay a $180 million
penalty in a settlement with the U.S. Securities and Exchange
Commission following allegations that it had fabricated more
than $300 million in sales.

 (Editing by Jeffrey Goldfarb and Katrina Hamlin)
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