Geely's EV maker Zeekr tops US IPO goal to fetch $441 million
Listing is the biggest by a China-based firm in the US since Didi's $4.4 billion IPO
Zeekr Intelligent Technology Holding Ltd., the high-end electric car brand under Zhejiang Geely Holding Group Co., expanded its initial public offering to raise $441 million in the biggest US listing by a China-based company since 2021.
Zeekr sold 21 million American depositary shares "- 3.5 million more than it had planned "- Thursday at the top of the marketed range of $18 to $21, according to a statement. With the upsize, the company has a market value of about $5.2 billion based on the outstanding shares listed in its filings with the US Securities and Exchange Commission.
Underwriters have an option to purchase up to 3.15 million more ADSs in an over-allotment option, which if exercised in full will lift the offering to 24.15 million ADSs, representing about 9.1 per cent of Zeekr's issued share capital, according to the filing.
Geely Auto, Mobileye Global Inc. and Contemporary Amperex Technology Co. Ltd. were interested in subscribing for as much as $349 million worth of shares in the offering, Zeekr had said in its filings.
Zeekr's offering adds to a US IPO market rebound that is steadily overtaking the lackluster volumes of the past two years. The roughly $17 billion raised via listings on US exchanges since Jan. 1 is almost double the total at this point last year, with close to half of 2023's volume coming from a single blockbuster, Johnson & Johnson's spinoff Kenvue Inc., according to data compiled by Bloomberg.
Biggest since Didi
The listing by Zeekr is the biggest by a China-based firm in the US since Didi Global Inc.'s $4.4 billion IPO almost three years ago. Days after the ride-hailing firm went public, it became the subject of investigation by Chinese regulators and delisted from the New York Stock Exchange less than a year later. The ensuing crackdown, which spread to wide swaths of the country's tech sector, crushed both share prices and US IPO activity.
Since then, listings on New York exchanges by Chinese companies have been small and rare.
Zeekr's valuation suffered in the aftermath, too. The company said in February 2023 that it had been valued at $13 billion in a funding.
Overcapacity in its domestic market also afflicts Zeekr and others such as BYD Co., leaving them eager to boost sales overseas. Zeekr warned investors in its prospectus that the Chinese government could intervene in its business to further its own regulatory, political and societal goals.
Zeekr founder and Chairman Li Shufu will control about 75 per cent of the shareholder voting power in the company after the IPO, according to the filings. He now presides over an empire that includes two other EV makers that are publicly traded in the US, as well as Volvo Car AB in Stockholm.
Lotus, Polestar
In February, Geely took automaker Lotus Technology Inc. public via a merger with a special purpose acquisition company. That followed Geely's Polestar Automotive Holding going public in a SPAC deal in 2022, and the listing of Volvo Car the previous year.
Last year, Zeekr had a net loss of $1.16 billion on about $7.3 billion in revenue, with the latter increasing more than 60 per cent from 2022, according to its filings.
The Zeekr lineup includes the 001, a five-seat crossover and the X, a compact sport utility vehicle. The brand has also launched the 007, a premium sedan.
The IPO is being led by Goldman Sachs Group Inc., Morgan Stanley, Bank of America Corp. and China International Capital Corp. The company's shares are expected to begin trading Friday on the New York Stock Exchange under the symbol ZK.