Chinese robotaxi firm WeRide announced on Friday its intention to pursue a valuation of up to USD 5.02 billion in its initial public offering (IPO) on the United States stock market. This ambitious step comes at a critical juncture for US-China relations in the tech sector, with the Biden administration reportedly poised to propose restrictions on Chinese software in autonomous vehicles operating within the United States.
WeRide, founded in 2017 and known for its diverse fleet of autonomous vehicles including taxis, vans, buses, and street sweepers, aims to raise as much as USD 119.4 million through the IPO. The company plans to offer 6.45 million American depositary shares priced between USD 15.50 and USD 18.50 per share. This public offering is complemented by a concurrent private placement, where certain investors have committed to purchasing shares worth USD 320.5 million, contingent on the IPO’s successful completion.
Among the notable investors participating in this private placement are Alliance Ventures BV, the venture capital arm of the Renault Nissan Mitsubishi Alliance, and JSC International Investment Fund SPC. Additionally, German automotive supplier Robert Bosch GmbH has expressed interest in acquiring up to USD 100 million worth of WeRide shares during the IPO.
The timing of WeRide’s IPO is particularly significant, as it would mark only the second major Chinese company to seek a US listing in 2024. This comes after a period of diminished Chinese IPO activity in the US market, following regulatory challenges that culminated in ride-hailing giant Didi Global’s forced delisting in 2022.
WeRide’s financial disclosures reveal the current state of its operations and the challenges faced by companies in the autonomous driving sector. For the six months ending June 30, 2024, the company reported a net loss of 881.7 million Chinese yuan (USD 123.04 million), an increase from the 723.1 million yuan loss reported in the same period the previous year. Revenue for this period stood at 150.3 million yuan, down from 182.9 million yuan year-over-year.
Despite these financial challenges, WeRide has made significant strides in expanding its operational footprint. The company is currently testing and conducting commercial pilots across 30 cities in seven countries, demonstrating the global ambitions of its autonomous driving technologies.
The autonomous driving industry as a whole continues to grapple with both technical and regulatory hurdles. While China has been proactive in approving trials for self-driving technologies, the regulatory landscape in the United States remains more cautious. This divergence in approach between the two nations adds an extra layer of complexity to WeRide’s US market entry.
WeRide’s IPO is being led by a trio of heavyweight financial institutions: Morgan Stanley, J.P. Morgan, and China International Capital Corp. Upon successful completion of the offering, the company plans to list on the Nasdaq under the ticker symbol “WRD”.
