By Arasu Kannagi Basil
(Reuters) -Pony AI is targeting a valuation of up to $4.48 billion in its U.S. initial public offering, it said on Thursday, as the Chinese self-driving company moves forward with its long-sought plan for a New York listing.
Pony, founded in 2016 and backed by the Japanese automaker Toyota (NYSE:), aims to raise up to $195 million by offering 15 million American Depositary Shares priced between $11 and $13 each.
Self-driving companies are trying to raise capital as they look to scale their operations. Guangzhou-based Pony, whose fleet includes more than 250 robotaxis and 190 robot rucks, will enter the US stock market following rival WeRide’s Nasdaq debut in October.
Two investors, including Chinese car manufacturer BAIC, have indicated they want to buy shares worth $74.9 million in the IPO.
Certain investors have also agreed to purchase approximately $153.4 million worth of shares through concurrent private placements.
Pony’s proposed target is a decline from its $8.5 billion valuation in a 2022 funding round. In September, the board lowered its minimum IPO valuation to $4 billion from $8.5 billion and its proceeds from $425 million to $200 million.
“The same bull or bear thesis that investors have on WeRide also applies to Pony AI,” said Matt Kennedy, senior strategist at Renaissance Capital, a provider of pre-IPO research and IPO-focused ETFs. “A currently small and unprofitable company growing rapidly in what is expected to be a huge market.”
Chinese companies are slowly pursuing an IPO in New York after a long hiatus after taxi giant Didi Global was forced to delist its US shares amid a clash with Beijing.
The IPO comes after a 2021 attempt to go public in a $12 billion blank check deal failed as Beijing cracked down on Chinese tech companies.
Beijing has since softened its stance and published rules last year to revive offshore listings.
Zeekr’s $441 million IPO in May is the largest U.S. listing by a China-based company in 2024, LSEG data shows.
ROCKY ROAD
While some are touting robotaxis as the future of mobility, analysts believe the industry has a difficult road ahead.
Safety concerns and regulatory roadblocks have slowed commercialization of the technology. Profitability is another hurdle, as robotaxis require significant investment in research and development.
Still, compared to the US, China has been quick to approve trials as authorities support economic goals.
Meanwhile, the White House is expected to ban vehicles with Chinese-developed systems on U.S. roads over national security concerns.
Pony, which secured $100 million from Saudi NEOM last year, is also backed by Canadian pension fund Ontario Teachers’ and venture capital firm HongShan, formerly Sequoia China.
Pony will list on the Nasdaq under the symbol “PONY”.
Goldman Sachs, BofA Securities, Deutsche Bank (ETR:), Huatai Securities and Tiger Brokers are underwriting the IPO.
