(Bloomberg) -- Morgan Stanley, Credit Suisse Group AG and Haitong International Securities Group were among the biggest participants in a series of margin loans to Luckin Coffee Inc.’s founder before accounting fraud allegations at the high-flying Chinese company triggered a collapse in the stock and caused him to default, a person with knowledge of the matter said.The banks were part of a group that extended margin debt to Luckin Chairman Lu Zhengyao across three funding rounds, said the person, who asked not to be identified as the matter is private. Haitong put up $140 million, while Morgan Stanley and Credit Suisse lent about $100 million each, the person said. Barclays Plc, Goldman Sachs Group Inc. and China International Capital Corp. had smaller exposures, the person said, adding that a portion of the loans were repaid before the default.Goldman Sachs said in a statement on Monday that an entity controlled by Lu’s...
(Bloomberg Opinion) -- Investors have been scalded by Luckin Coffee Inc.’s news this month that it inflated revenue numbers, a revelation that came less than a year after the chain went public on the Nasdaq exchange. Shares in the company — whose $645 million IPO was the second largest in the U.S. by a Chinese firm in the last 12 months — have swooned 74%. Suddenly, Chinese companies’ opaque numbers are dinner-table conversation again, with the scandal sending other listings from the nation into a tailspin and threatening to close off the overseas market for new issuers. We have been here before. After short sellers such as Muddy Waters, which bet against Luckin, spotted Toronto-listed Sino-Forest’s overstated timber assets in 2011, Chinese listings in the U.S. evaporated. But they eventually came back as tighter standards were put in place. By 2014, Chinese company IPOs in the U.S. hit an all-time high of $29 billion, buoyed by Alibaba Group Holding Ltd.’s record-breaking $25 billion deal...
Coronavirus is probably the 1 concern in investors' minds right now. It should be. On February 27th we published an article with the title Recession is Imminent: We Need A Travel Ban NOW. We predicted that a US recession is imminent and US stocks will go down by at least 20% in the next 3-6 […]...
U.S. casino operator Wynn Resorts Ltd and automated teller machines maker NCR Corp jointly raised $1 billion on Tuesday, in the first unsecured junk-rated bond offerings since the market was roiled by the coronavirus outbreak at the start of March. The offerings indicate investor appetite for risk is gradually returning in the market for new corporate debt rated below investment grade. The so-called high-yield market has been supported by the Federal Reserve's pledge to backstop the investment-grade market, according to Bill Zox, chief investment officer of fixed income at Diamond Hill Capital Management....
Boeing Co said late on Tuesday it will make two new software updates to the 737 MAX's flight control computer as it works to win regulatory approval to resume flights after the jet was grounded following two fatal crashes in five months. The planemaker confirmed to Reuters that one issue involves hypothetical faults in the flight control computer microprocessor, which could potentially lead to a loss of control known as a runaway stabilizer, while the other issue could potentially lead to disengagement of the autopilot feature during final approach. Boeing said the software updates will address both issues....
The Transportation Safety Administration, in response to the COVID-19 outbreak, has granted an exemption for Hazardous Material Endorsement (HME) holders. ...
