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China Auto Rental suspends Nasdaq IPO
By Jin Jing |
April 25, 2012, Wednesday
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Online Edition
Online Edition
CHINA Auto Rental announced the suspension of its initial public offering on the Nasdaq today due to a sluggish stock market environment.
The Beijing-based company said the current capital market conditions could not reasonably reflect the value of the company. The decision was made one day before its scheduled debut.
Established in 2007, China Auto Rental has grown to China's largest car rental company, expanding its business to a fleet of around 29,000 cars by the end of March and operating in 66 cities across the country with over 500 service locations.
The company earlier expected to raise a maximum of US$158.1 million through the listing program to help it expand its fleet and increase working capital. It planned to issue 11 million American Depositary shares, priced between US$10.5 to US$12.5 a piece.
China Auto Rental's IPO suspension came after a series of Chinese-based companies were involved in fraud allegations before they obtained financing on the US stock market. The US Securities and Exchange Commission earlier accused China's commercial vehicle trader AutoChina International of stock manipulation.
China Auto Rental has been reportedly struggling to attract investors as its net loss widened to 151 million yuan (US$24 million) last year while revenue jumped fivefold to US$123 million, according to its filings. But in the first quarter of this year, the company reported a net profit of US$845,000 while adjusted EBITDA rocketed 350 percent to US$31 million.
The Beijing-based company said the current capital market conditions could not reasonably reflect the value of the company. The decision was made one day before its scheduled debut.
Established in 2007, China Auto Rental has grown to China's largest car rental company, expanding its business to a fleet of around 29,000 cars by the end of March and operating in 66 cities across the country with over 500 service locations.
The company earlier expected to raise a maximum of US$158.1 million through the listing program to help it expand its fleet and increase working capital. It planned to issue 11 million American Depositary shares, priced between US$10.5 to US$12.5 a piece.
China Auto Rental's IPO suspension came after a series of Chinese-based companies were involved in fraud allegations before they obtained financing on the US stock market. The US Securities and Exchange Commission earlier accused China's commercial vehicle trader AutoChina International of stock manipulation.
China Auto Rental has been reportedly struggling to attract investors as its net loss widened to 151 million yuan (US$24 million) last year while revenue jumped fivefold to US$123 million, according to its filings. But in the first quarter of this year, the company reported a net profit of US$845,000 while adjusted EBITDA rocketed 350 percent to US$31 million.
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