Pinduoduo talks $1.75 billion five-year convertible notes with fixed coupon of 0%, up 40%-50%

By Abigail W. Adams

Portland, Me., Nov. 16 – Pinduoduo Inc. plans to price $1.75 billion of five-year convertible notes after the market close on Tuesday with price talk for a fixed coupon of 0% and an initial conversion premium of 40% to 50%, according to a market source.

Goldman Sachs (Asia) LLC, BofA Securities Inc. and China Renaissance Securities (Hong Kong) Ltd. are bookrunners for the registered offering, which carries a greenshoe of $250 million.

The notes are non-callable until Dec. 6, 2023 then subject to a 130% hurdle.

They are putable on Dec. 1, 2023 or upon the occurrence of a fundamental change.

Concurrently with the convertible notes offering, the company is pricing a secondary offering of up to 22 million American Depositary Shares.

The secondary offering carries a greenshoe of 3.3 million.

Proceeds will be used to strengthen the company’s balance sheet, to expand its business operations and for future acquisitions and partnerships.

Pinduoduo is a Shanghai-based e-commerce platform.

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