Luckin Coffee denies report claiming its non-executive chairman is asking for a bank loan in exchange for IPO mandates

A Reuters report on Tuesday claimed that Luckin Coffee’s non-executive chairman and angel investor Lu Zhengyao has requested a personal loan of at least US$200 million from banks. What makes this noteworthy is that the personal financing deal — primarily backed by Lu’s Luckin shares — has been woven into the banks’ IPO mandate agreement, according to sources cited by Reuters.

In other words, only banks offering Lu Zhengyao the loan would get the mandate for Luckin Coffee’s upcoming US initial public offering.

Luckin Coffee, when contacted by Economic Daily-affiliated news website ce.cnWednesday, denied this, calling the report “fake news.”

According to Reuter’ssources,one bank, Credit Suisse has already agreed to provide part of the US$200 million. Goldman Sachs and Morgan Stanley are said to be still negotiating the loan terms, while a fourth, unnamed bank said it decided not to lend to Lu Zhengyao,  due to a lack of clarity on Lu’s plans for the proceeds and therefore expects not to be involved in the IPO.