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Luckin Coffee, China's unprofitable Starbucks rival, goes public

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  1. #11

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    Quote Originally Posted by RMDNC:
    Acually .. the threads on weibo and few other places are self congratulatory ... "Look how we took the Americans for a ride" (not literally in the case of that car rental...)

    https://twitter.com/alexliusq/status...16601271271425

  2. #12

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    Quote Originally Posted by shri:
    Acually .. the threads on weibo and few other places are self congratulatory ... "Look how we took the Americans for a ride" (not literally in the case of that car rental...)

    https://twitter.com/alexliusq/status...16601271271425
    The non congratulatory ones no longer exist LOL. China's economy was basically a race of whether companies run by idiots who don't know how to run a company but received boatloads of cash vs the money running out and their numbers don't actually make sense anymore. Then come the bailouts, so if they are luck-in, they would get bailed out. In the coffee world, I doubt this is the case. There are a few with great potential, but generally it's mostly companies created to get rich, not to grow a solid business.
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  3. #13

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    Mary Ma goes postal on them .. "How pathetic".

    Mainlanders continue to rally around the company of which they are so proud. An online survey by Sina Tech shows that over half of 80,000 respondents accepted Luckin's apology and would continue to view the company as a national champion as long as it corrected its mistakes.

    As some fans wrote, it has reaped rewards for Americans, not Chinese.

    How pathetic.
    Meanwhile another company TAL is crashing ...

    https://www.thestandard.com.hk/secti...a-bitter-taste

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  5. #15

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    IMO the Chairman and CEO and possibly even the CFO were complict in all this. COO for sure did not have as much to gain as the first two. He's just the fall guy. Higher stock price equates to larger margin loan and consider who has the huge loans and motive to inflate the stock price. CFO must be blind or direlict in duty not to vet internal controls. Either that or the trio pulled the wool over the laowai's eyes. What also struck me as odd from the get go was LK choosing a mid level banker as CFO instead of someone more versed in the untethical and often immoral business practices of the Mainland and someone not versed operationally in running a company in China which can be an evironment with little moral compass IMO. All reponsible should be hung from a tall tree or injected with the Wuhan virus IMO.

    Coolboy likes this.

  6. #16

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    Quote Originally Posted by RMDNC:
    IMO the Chairman and CEO and possibly even the CFO were complict in all this. COO for sure did not have as much to gain as the first two. He's just the fall guy. Higher stock price equates to larger margin loan and consider who has the huge loans and motive to inflate the stock price. CFO must be blind or direlect in duty not to vet internal controls. Either that or the trio pulled the wool over the laowai's eyes. What also struck me as odd from the get go was LK choosing a mid level banker as CFO instead of someone more versed in the untethical and often immoral business practices of the Mainland and someone not versed operationally in running a company in China which can be an evironment with little moral compass IMO. All reponsible should be hung from a tall tree or injected with the Wuhan virus IMO.
    There is simply no way the Chairman, CEO and CFO would miss this trickery. I cannot believe they would look at the numbers themselves and thought nothing fishy was going on. They were in on the game 100%.
    RMDNC likes this.

  7. #17

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    What surprises me is that such a young company was able to get a listing in US and that ppl actually, “buy it”


  8. #18

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    This reminds of the time when I first heard Ian Dury's "Take Me To The Cleaners" and at fifteen while relatively fluent in english I wasn't all that familiar with lot of the idioms... :-)
    (hearing it still makes me chuckle, twice)


    A well-written long read on the Luckin scam and how PRC firms get a fleece-foreigners-free pass.

    The Wire China — The Big China Short
    How an army of investigators and short-sellers got the world to wake up and smell the fraud
    (Thanks Hemlock)


    Some of the biggest names in U.S. investing may have been caught holding large Luckin positions as the storm was breaking, according to their most recent disclosures to the SEC.

    Luckin and the underwriters are also facing potential liability from two lawsuits that have been filed by investors against it in federal court in New York. One of those suits also names the underwriters of the Luckin share offerings as defendants. Both suits allege fraud against the shareholders.

    But if Luckin does not settle, the plaintiffs would face hurdles in recovering any judgment made against it, since China rarely enforces U.S. court orders.

    Another hurdle to recouping losses from Luckin is its complex corporate structure, which the company referenced in its IPO documents as a “risk factor” in investing in the stock. Luckin’s investors in the U.S.-listed shares do not directly own all of Luckin’s assets, according to the offering prospectus, due to a structure designed to circumvent Chinese restrictions on foreign ownership of its companies. The structure could make it difficult for U.S. lenders or investors to recover money from Luckin.
    Coolboy, Morrison, huja and 1 others like this.

  9. #19

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    This does hurt foreigners too, but the main victim of rigged mainland markets is people in the mainland themselves.

    Coolboy likes this.

  10. #20

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    Quote Originally Posted by GentleGeorge:
    This does hurt foreigners too, but the main victim of rigged mainland markets is people in the mainland themselves.
    I believe, like many other frauds of this nature, it was primarily listed on the Nasdaq as an irresistible China growth/tech play.