In an announcement Friday explaining its Chapter 15 submitting
, Luckin stated the transfer will assist it financially restructure itself and strengthen its stability sheet. That sort of submitting shelters the US property of overseas firms present process restructuring proceedings of their residence nation.
Chapter will not “materially influence” Luckin’s day-to-day operations and its roughly three,600 cafes will stay open, in line with a launch.
The submitting caps off a tough yr for the corporate. Final April, it was revealed that Luckin’s former chief working officer Jian Liu
and a number of other of his direct stories “had engaged in sure misconduct, together with fabricating sure transactions” starting in 2019 amounting to about $310 million.
Lu and CEO Jenny Zhiya Qian had been each fired Might 2020. Months later, its inventory was delisted
on the Nasdaq alternate. In December, the Securities and Alternate Fee slapped the corporate with a $180 million penalty to settle fraud fees.
Luckin went public in 2019 and surged due to what gave the impression to be sturdy gross sales development. Buyers lapped up the inventory, betting that the chain would develop into a professional rival to Starbucks, which generates a giant chunk of its income from Chinese language shoppers.