Luckin Coffee Eyes U.S. Relisting as Five-Year Turnaround from Fraud Scandal Takes Hold

Luckin Coffee is preparing to relist its shares in the U.S., its co-founder and CEO, Jinyi Guo, said at an entrepreneurs’ gathering earlier this month, five years after a $300 million accounting scandal derailed the coffee chain’s business.

Speaking at a government-hosted event in the southeastern city of Xiamen, where Luckin Coffee is headquartered, Guo said that “under the municipal government’s guidance, we are actively pushing the process of relisting on a U.S. main board.”

The relisting process, once completed, would help promote Xiamen’s reputation as an attractive venue for global business and investment, Guo added, while acknowledging the government’s support for Luckin’s turnaround. However, Guo did not provide details on the company’s progress toward a relisting.

Luckin was delisted from the Nasdaq stock exchange in June 2020 after revelations that the coffee chain had fabricated over $310 million in revenue for 2019. Six months later, Luckin agreed to pay a $180 million penalty to settle accounting fraud charges with the U.S. Securities and Exchange Commission.

Guo took over the helm as the new CEO in 2020, following the ouster of co-founder and former chairman Charles Zhengyao Lu in the aftermath of an internal fraud investigation.

In 2022, Luckin announced that it had completed the restructuring of its financial debt and emerged from Chapter 15 bankruptcy proceedings.

Its shares have continued to trade over-the-counter in the U.S. since its delisting, giving the company a market valuation of approximately $10.9 billion as of Tuesday night. For comparison, Starbucks’ operations in China were recently valued at $4 billion on a cash-free and debt-free basis, excluding Starbucks’ licensing of its brand and intellectual property.