Luckin Coffee Inc. (Pink: LKNCY) shares, which are traded over the counter following the financial improprieties that forced a bankruptcy filing, saw some upward bounce Thursday before pulling back.
What Happened: Luckin said it has entered into an investment agreement with Centurium Capital and Joy Capital, two Chinese private equity investment firms, that could potentially fetch the coffee retailer up to $400 million in financing.
Centurium, which is serving as the lead investor, has agreed to invest about $240 million in senior convertible preferred shares of Luckin through a private placement.
Joy Capital will invest about $10 million in senior preferred shares.
Both Centurium and Joy Capital, under certain circumstances, may upsize the investment on a pro rata basis for an additional $150 million, Luckin said.
The closing of the transactions is contingent on a series of closing conditions, including a restructuring of $460 million of the company’s debt.
