SBUX Starbucks Corporation

By Colin Kellaher

Luckin Coffee Inc. on Monday said it will offer 30 million American depositary shares in its initial public offering, with an expected price range of $15 to $17 each.

In a filing with the Securities and Exchange Commission, the second-largest Chinese coffee chain said it will sell an additional $50 million in stock to commodities trader Louis Dreyfus Co. in a concurrent private placement.

At the $16 midpoint of the anticipated IPO price range, Luckin said it expects net proceeds from the offering and the private placement of about $490 million, or roughly $557 million if the underwriters exercise their option to buy an additional 4.5 million ADSs.

The company said it will use the proceeds for general corporate purposes, including the expansion of its store network as it looks to overtake Starbucks Corp. (SBUX) as the largest coffee network in China.

Luckin, which had 2,370 locations as of March 31, said it aims to become the biggest network in terms of store count by the end of 2019.

Starbucks currently has 3,700 China locations, with plans to open nearly 600 stores this year.

Luckin, which plans to list its ADSs on the Nasdaq Global Select Market under the symbol LK, said Louis Dreyfus is buying the stock as part of a joint venture that will build and operate a coffee roasting plant in China.

Write to Colin Kellaher at colin.kellaher@wsj.com

(END) Dow Jones Newswires

May 06, 2019 12:29 ET (16:29 GMT)

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