WeRide, a Chinese autonomous vehicle company, is officially gearing up for a U.S. public debut, over a year after China started easing its effective ban of foreign IPOs. The company is seeking a valuation as high as $ 5.02 billion in its initial public offering.
WeRide expects to raise about $ 96 million from its offering, or $ 111.3 million if its underwriters exercise their over-allotment option in full, assuming an IPO share price of $ 17 per American Depository Share (ADS). The company is offering 6.45 million ADSs at a price range of $ 15.50 and $ 18.50 per share, so it could even raise as much as $ 119.4 million in the IPO.
On top of that, certain investors have already agreed to purchase shares worth $ 320.5 million in a concurrent private placement. For example, Alliance Ventures, the venture arm of the Renault Nissan Mitsubishi Alliance, has agreed to buy $ 97 million worth of shares. Other investors include JSC International Investment Fund, Get Ride, and Beijing Minghong, according to a regulatory filing.
The filing comes after Bloomberg reported that WeRide is seeking up to $ 400 million in its IPO and private placement, citing sources familiar with the matter. About $ 100 million of that would come from the IPO and around $ 200 million to $ 300 million in the placement.
WeRide did not respond in time to comment.
If and when WeRide goes public, this will be the largest IPO by a Chinese company on the U.S. stock market since Geely-owned luxury EV startup Zeekr began selling shares on the New York Stock Exchange in May. Zeekr’s stock has fallen 48% since its debut.
WeRide initially filed confidentially to go public in the U.S. in March 2023. The AV company has raised a total of $ 1.39 billion at a $ 5.11 billion valuation, per PitchBook data. But WeRide hasn’t raised a private round since 2022, and VCs have pulled back from writing large checks for autonomous vehicle companies with long roads to profitability. If WeRide hopes to scale and stay competitive, it’ll need to access the public markets.
The company holds permits to operate autonomously in China, the UAE and Singapore. It also has permits to test with a driver and without a driver in California, and is actively testing in San Jose. Aside from a publicly accessible robotaxi operation, WeRide is working on a driverless robobus, robovan (for goods delivery) and robosweeper. The company also offers advanced driver assistance systems and plans to sell them to OEMs.
WeRide’s revenue for the first six months of 2024 was $ 20.7 million, which is lower than the first half of 2023’s revenue of about $ 25.5 million, according to a regulatory filing. That’s on a loss of $ 121.3 million for the first half of 2024, and of $ 100.9 million in the first half of 2023.
Per WeRide’s filing, the company plans to spend 35% of the proceeds from its IPO on R&D; 30% on commercialization and operation of its autonomous driving fleets, as well as marketing activities to expand to new markets; 25% on capital expenditures like the purchase of test vehicles; and the remaining 10% for general corporate purposes.
WeRide isn’t the only Chinese AV company that’s looking to try its luck on the U.S. markets. Pony.ai, one of its main competitors, is also reportedly preparing for a U.S. IPO again, after its previous efforts fell apart in 2021. Pony was eyeing a public debut at a $ 12 billion valuation through a SPAC merger, but put it on hold as it struggled to gain assurances from Beijing that it wouldn’t become a target of a crackdown against Chinese firms going public on foreign exchanges.
This article has been updated to include WeRide’s estimated valuation, the total amount it hopes to raise, and information about investment from private placement. This article was originally published August 9 at 10:15 am PT.
