Luckin Coffee, the scandal-plagued Chinese coffee shop chain, secured a $260 million investment from existing shareholders Centurium Capital and Joy Capital. It also replaced its independent auditor.
This will help Luckin satisfy a $180 million settlement struck last year with the SEC, which had accused Luckin of faking retail sales figures. The company went public on the Nasdaq less than two years ago at a $4.3 billion valuation but was later delisted because of the accounting fraud.
The investment is structured as convertible preferred stock, with an option for Centurium and Joy to invest an additional $150 million.
The bottom line, Luckin was supposed to be China’s answer to Starbucks, but so far has been closer to China’s answer to Enron.