WeRide, a Chinese autonomous vehicle company, is now preparing for its highly anticipated public debut in the United States. This comes after China began to relax its restrictions on foreign IPOs more than a year ago. The company aims to achieve a valuation of up to $5.02 billion in its upcoming initial public offering.
WeRide is projected to generate approximately $96 million from its offering, or potentially $111.3 million if its underwriters fully exercise their over-allotment option. This estimation is based on 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, which could potentially result in a substantial amount of $119.4 million being raised in the IPO.
In addition, a group of investors has already committed to buying shares worth $320.5 million through a simultaneous private placement. As an illustration, Alliance Ventures, the venture arm of the Renault Nissan Mitsubishi Alliance, has made a deal to purchase shares worth $97 million. Additional investors listed in a regulatory filing include JSC International Investment Fund, Get Ride, and Beijing Minghong. 
WeRide is reportedly aiming to raise $400 million through its IPO and private placement, according to sources with knowledge of the situation. A significant portion of the funds, approximately $100 million, would be raised through the IPO, while an additional $200 million to $300 million would be generated through the placement.
WeRide failed to respond promptly to the comment.
Should WeRide decide to go public, it would mark a significant milestone as the biggest initial public offering by a Chinese company on the U.S. stock market since Zeekr, a luxury EV startup owned by Geely, commenced trading on the New York Stock Exchange in May. Since its debut, Zeekr’s stock has experienced a significant decline of 48%.
WeRide filed for an initial public offering in the United States in March 2023. According to PitchBook data, the AV company has successfully raised a significant amount of $1.39 billion, with a valuation of $5.11 billion. However, WeRide has not secured any private funding since 2022, and venture capitalists have become more cautious about investing significant amounts in autonomous vehicle companies that may take a while to become profitable. In order for WeRide to achieve growth and maintain its competitiveness, it will be necessary for the company to have access to the public markets.
The company has obtained permits to operate independently in China, the UAE, and Singapore. In addition, it holds permits for conducting tests both with and without a driver in California and is currently engaged in active testing in San Jose. WeRide is currently developing a range of autonomous vehicles, including a driverless robobus, a robovan for goods delivery, and a robosweeper. In addition to its range of products, the company has developed advanced driver assistance systems that it intends to market to original equipment manufacturers.
According to a regulatory filing, WeRide’s revenue for the first six months of 2024 amounted to $20.7 million, which is slightly lower than the revenue of approximately $25.5 million generated in the first half of 2023. The company experienced a loss of $121.3 million in the first half of 2024 and a loss of $100.9 million in the first half of 2023.
According to WeRide’s filing, the company intends to allocate a significant portion of the funds raised through its IPO towards research and development. Additionally, a substantial portion will be dedicated to the commercialization and operation of their autonomous driving fleets, along with marketing efforts to enter new markets. Another portion will be used for capital expenditures, such as acquiring test vehicles. The remaining funds will be utilized for general corporate purposes.
There are other Chinese AV companies also exploring opportunities in the U.S. markets. According to reports, Pony.ai, a major competitor, is once again gearing up for a U.S. IPO, following the setbacks it faced in 2021. With aspirations of a grand entrance into the public market at a staggering $12 billion valuation, Pony had to temporarily delay its plans. The reason behind this decision was the company’s difficulty in obtaining guarantees from Beijing that it would not fall victim to the crackdown on Chinese companies listing on international exchanges.
