Luckin Coffee Receives Formal Delisting Notice From Nasdaq from freemexy's blog

Luckin Coffee Receives Formal Delisting Notice From Nasdaq

Luckin Coffee Inc. (LK) - Get Report said Tuesday that it has received a formal delisting notice from the Nasdaq as the China-based rival to Starbucks (SBUX) - Get Report continues to suffer the fallout from its multi-million dollar 'fake sales' scandal.To get more news about luckin coffee share price, you can visit shine news official website.

Luckin said the notice, which was received on June 17, was linked to its inability to file an annual report for its 2019 financial year, which the company put down to the complexities of the global coronavirus pandemic and its own investigation into fraud claims fraud claims linked to an April 2 admission that around RMB2.2 billion ($310 million) may have been fabricated in a scheme linked to its former COO.

"The Company has been working diligently to explore possible ways to file the Annual Report as soon as possible,' Luckin said in a filing to the U.S. Securities and Exchange Commission. "However, the Company has not been able to file the Annual Report due to the impact of the delayed financial statement preparation process caused by COVID-19 and the pendency of the previously disclosed internal investigation."

Luckin shares plunged 16.75% Monday amid reports that investors were planning to oust founder and chairman Charles Zhengyao, as well as other members of the board, at an extraordinary general meeting scheduled for July 5.

Shares were marked 15.8% lower in early trading Tuesday following the SEC filing to change hands at $2.69 each, a move that would mark a 90% decline since the group first revealed its 'fake sales' scandal in early April.Beijing-based Luckin listed on the Nasdaq in May of last year with a market value of $4.2 billion after pricing its IPO at $17 each. It raised another $1.1 billion in a secondary offering in early January. At its peak, Luckin traded at just over $50 a share with a market value of $12 billion.

Founded in 2017 by its current CEO, Qian Zhiya, Luckin has around 4,500 coffee outlets in China as it goes head-to-head with Starbucks in the world's biggest coffee market.

Luckin, which is backed by BlackRock BLKB and Singapore's powerful sovereign wealth fund, estimates consumption will rise to 15.5 billion cups by 2023, nearly 80% higher than last year's record levels.

Last month, the Beijing-based group said CEO Jenny Zhiya Qian, as well as chief operating officer Jian Liu were fired after its internal investigation "brought to the attention of the Board evidence that sheds more light on the fabricated transactions" the company detailed in early April.