Ruixing Coffee (Nasdaq: LK) has been exposed to false transactions before being exposed to IPO.
On May 29, the Wall Street Journal quoted informed sources that before the initial public offering, a group of Ruixing Coffee employees had designed fake transactions to help sales growth of. A person familiar with the situation revealed that employees would register personal accounts to purchase a large number of vouchers, and in this way fabricated at least 200 million to 300 million yuan in sales.
In addition, the Wall Street Journal also found through Ruixing Coffee ’s internal records that the fraudulent behavior also subsequently involved corporate customers. Records show that dozens of unknown companies bought a large number of vouchers from Ruixing Coffee, and often placed orders in the middle of the night. Among them, a company called Qingdao Zhixuan Business Consulting Co., Ltd. (transliteration) purchased vouchers worth 960,000 yuan in one order, and operated a similar number of hundreds between May and November last year. Orders.
The Wall Street Journal found that through a complicated network relationship, Qingdao Zhixuan Business Consulting Co., Ltd. was in fact a relative of Lu Xingyao, chairman of Ruixing Coffee, and one of Shenzhou UCAR. The executive is related to a senior executive of Ruixing Coffee. In addition, the phone number and email address of Qingdao Zhixuan Business Consulting Co., Ltd. are also the same as a branch of Shenzhou Youche.
Analyzing these orders, the Wall Street Journal believes that Ruixing Coffee has at least 1.5 billion orders from these companies during 2019.
In addition to the inflated orders, the Wall Street Journal believes that Ruixing also inflated payment records. According to the company’s internal documents, Ruixing Coffee has a payment record of more than 1 billion suspicious suppliers, many of which do not even exist before April and May 2019. Moreover, these transactions were handled by an employee named Ms. Liang, but according to people familiar with the matter, the woman did not exist.
Rui Xing Coffee is headquartered in Xiamen, Fujian, and started trial operation in January 2018. In November 2017, Qian Zhiya stepped down as the director and COO of UCAR, and left the business to establish Ruixing Coffee. In May 2019, Ruixing Coffee, which was established only two years ago, landed on the Nasdaq in the United States with the fastest IPO of Chinese stocks.
On April 2 this year, Ruixing Coffee announced that the self-examination found that the company ’s chief operating officer Liu Jian was fraudulent in finance and involved approximately 2.2 billion yuan in transaction value. The company ’s board of directors was established Special committee to conduct internal investigations. In addition, a number of law firms in the United States initiated class actions against them, suing Ruixing CoffeeMaking false and misleading statements violates US securities laws.
On May 19, according to the documents submitted by Ruixing Coffee to the US Securities and Exchange Commission (SEC), the company received the US Securities and Exchange Commission listing on May 15. In a written notice from the Listing Qualifications Staff, the Nasdaq Exchange decided to delist the company.
For the Nasdaq decision, Ruixing Coffee said that it plans to request a hearing on this decision, and will continue to be held in Nasdaq until the hearing results are released. Go public. The hearing is usually scheduled 30 to 45 days after the request of the hearing.
Recently, after the trading of Ruixing Coffee resumed on May 20, its stock price experienced a roller coaster trend. After three consecutive days of sharp declines, Ruixing Coffee On May 26 and 27, it rose for two consecutive days, and it rose more than 70% on the 26th. According to market analysis, there are either “Pan Xia” willing to acquire some of Ruixing’s assets, or the organization wants to close the position and leave, but the three potential buyers who have made comments in the market (Yum China, Canadian coffee brand Tim Hortons, Hi tea) ) All expressed denial.
US stocks closed on May 28 local time, Ruixing Coffee closed at US $ 2.06 per share, down 20.46% from the previous trading day.