Chinese Drone Taxi IPO Takes Flight

On December 12, EHang Holdings Ltd (NASDAQ:EH), a Chinese drone and flying taxi company, raised $40 million for its IPO. The company offered 3.2 million shares at $12.50 a share. This price was the low end of its range $12.50 to $14.50. According to NASDAQ, “Insiders had indicated on $7 million of the IPO… At the IPO price, EHang commands a fully diluted market cap of $687 million. It is one of the few drone specific companies to go public.

EHang has claimed to be the first to launch autonomous aerial vehicles (AAVs) that can hold passengers, also called flying taxis. They have 38 AAVs, and have developed two command centers for smart city management and finished more that 70 aerial trials. The flying taxis are essentially drones large enough to carry passengers.

In November, EHang filed paperwork with the US Securities and Exchange Commission to go public with a $100 million initial offering. Over the years, the company has proven to be an industry leader. EHang is close to commercial production of its passenger drones. However, work still needs to be done with infrastructure and regulations.

For the IPO, “Morgan Stanley & Co. LLC, is acting as the sole bookrunner for the offering, and Needham & Company, LLC, Tiger Brokers (NZ) Limited and Prime Number Capital, LLC are acting as co-managers for the offering.”

The offering is expected to go from December 12 to December 16. As of time of publication, it peaked at $13.17 on December 13 and is at a low of $11.52 on December 17. At its peak it closed at $12.9 on December 13.