China’s Pinduoduo to price $875 million five-year convertibles to yield 0%-0.25%, up 32.5%-37.5%

By Rebecca Melvin

New York, Sept. 23 – Pinduoduo Inc. plans to sell $875 million of five-year convertible senior notes that were being talked at a coupon range of 0% to 0.25% and an initial conversion premium of 32.5% to 37.5%, according to a market source. Final terms were expected to be set after the market close on Tuesday.

The Rule 144A and Regulation S offering has an option for up to an additional $125 million of notes.

Joint bookrunners are BofA Securities Inc. Goldman Sachs, Barclays and UBS.

The notes are non-callable for three years and then provisionally callable if shares exceed 130% of the conversion price. There is also a put in year three.

The notes also have dividend and change-of-control protection.

Proceeds of the offering will be used to enhance and expand business operations, for research and development, to continue to invest in and develop its technology infrastructure and for working capital and other general corporate purposes.

Pinduoduo is a Chinese e-commerce platform.

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