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Chinese coffee company Luckin will be delisted after defrauding investors

June 26, 2020. Summarized by summa-bot.

HANGZHOU, CHINA - APRIL 03 2020: A staff works in a Luckin Coffee outlet in Hangzhou in east China's Zhejiang province Friday, April 03, 2020. The Chinese coffee brand admitted it falsified revenue by 2.2 billion yuan last year.- PHOTOGRAPH BY Feature China / Barcroft Studios / Future Publishing (Photo credit should read Feature China/Barcroft Media via Getty Images)

China's Luckin Coffee had hopes of being as successful with American investors as its rival Starbucks. But following an accounting scandal, Luckin is now heading to Wall Street's graveyard.

New York (CNN Business)China's Luckin Coffee (LK) had hopes of being as successful with American investors as its rival Starbucks.

But following an accounting scandal, Luckin is now heading to Wall Street's graveyard.

Luckin announced Friday that it was giving up plans to appeal the Nasdaq exchange's decision to delist the stock.

Shares of Luckin, which fired its CEO and chief operating officer in May after it was discovered that the company fraudulently inflated sales, plunged more than 50% to about $1. 40.

Investors lapped up the stock, betting that Luckin would become a legitimate homegrown rival to Starbucks (SBUX), which generates a big chunk of its revenue from Chinese consumers.

It's not clear what's next for Luckin now that it will no longer have access to the stock market to raise new capital.

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