(Yicai Global) April 10 -- Luckin Coffee, the Chinese coffee chain that faked CNY2.2 billion (USD310 million) worth of sales last year, has increased its registered capital by USD500 million.
The company, which positions itself as Starbucks’ top rival, topped up its registered capital to USD2.05 billion, according to data on business information platform Tianyancha.
“When a firm increases capital voluntarily it is trying to get credit from investors and lenders,” Gao Tingting, a lawyer from Beijing Zhong Yin Law Firm, told The Paper. From a legal perspective, this is Luckin’s attempt to show an ability to undertake risk, he added.
Luckin confessed on April 2 that its chief operations officer and other employees had inflated its 2019 sales figures, prompting its share price to dive 80 percent before it suspended trading on April 7.
Editor: James Boynton