Chinese EV maker XPeng seeks to raise US$1.1b in US IPO

[SAN FRANCISCO] Chinese electric-car startup Xpeng Motors is seeking in its US initial public offering to raise US$1.1 billion, slightly topping last month's listing by rival Li Auto Inc.

XPeng Inc, in a filing Friday with the US Securities and Exchange Commission, said it planned to sell 85 million American depositary shares for US$11 to US$13 each. Based on the shares listed in the filing, the company would have a market value of about US$9.17 billion at the top of that range.

Electric-vehicle makers have been enjoying a surge in investor interest after strong share price gains this year by Tesla Inc and NIO Inc. Li Auto, which increased the size of its US IPO, has since climbed 32 per cent from its offer price.

Guangzhou-based XPeng closed its latest funding round for a total of US$900 million, according to its filings. The Qatar Investment Authority put in US$100 million while Abu Dhabi's Mubadala invested another US$100 million, the company said in the prospectus. Alibaba Group Holding also contributed US$215 million, boosting its investment in XPeng.

China is the world's largest EV market, but also highly competitive. As public subsidies have been withdrawn, demand has fallen. A Tesla offensive to make cars locally has heaped more pressure on local players.

After years of developing cars and trying to boost their profiles globally, Chinese EV makers are now taking steps to go public as the virus pandemic and economic slowdown squeeze the market, boosting competition. Hozon New Energy Automobile Co has said it would list in Shanghai as soon as next year. WM Motor Technology Co is also weighing an initial stock sale in China as soon as this year, people familiar with the matter have said.

XPeng has delivered 18,741 of its first vehicle, the G3 SUV, through July 31, according to the company's filing. It started deliveries of its second model, the P7 sedan, in May, shipping 1,966 units by July 31, according to its filings.

For the six months ended June 30, XPeng said it had a net loss of US$113 million on revenue of US$142 million.

The depositary shares will be worth two ordinary Class A shares. The company's voting power will be controlled by holders of Class B and Class C shares, which will carry 10 and five votes each, respectively.

The offering is being led by Credit Suisse Group AG, JPMorgan Chase & Co and Bank of America Corp. The company is planning to list its shares on the New York Stock Exchange under the symbol XPEV.

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