Shares of Nio (9866) once slumped 13 percent in Hong Kong after the Chinese electric vehicle maker, along with its executives, was named in a lawsuit filed by Singapore's sovereign wealth fund, GIC, in a US court.
A senior executive of Nio said in a response that the charges were based on a report by short selling agency Grizzly Research in 2022 when the company had rebutted it as lack of legal grounds, mainland media reported.
The suit alleges the company violated securities laws by misrepresenting its financial health.
The legal action, initiated in August, targets the company, its chief executive Li Bin, and former chief financial officer Feng Wei. This move is considered unusual, as it is reportedly the first time a sovereign wealth fund has taken such legal action against an overseas-listed Chinese company.
This development adds to the challenges for Nio, which has been navigating an intense price war in China's competitive EV market. The lawsuit claims that Nio made false and misleading statements regarding its relationship with an affiliate, Nio Battery Asset (Weineng), and omitted critical information about its business and finances.
Following the news, Nio's stock declined 6.3 percent in Hong Kong and 7 percent in Singapore.
