Pinduoduo to Raise $875 Million Through Notes Offering
China's discounter platform said it plans to boost its R&D, technology infrastructure, working capital and general corporate purposes with the new funds.
Pinduoduo Inc. (Nasdaq: PDD) announced on Tuesday that it will issue $875 million worth of convertible preferred bonds due Oct 2024, sending its shares on a slide down more than 8% to $30.99 apiece.
The company said initial bond subscribers may purchase up to an additional $125 million in 13 days. Based on this, the estimated scale of this issue will be about $1 billion. Goldman Sachs, Merrill Lynch, Barclays, and UBS are jointly underwriting the deal, according to the report.
Pinduoduo said it plans to use the proceeds from the offering primarily for R&D and new agricultural infrastructure construction, investment in agricultural science and technology R&D and agricultural products upstream system construction and accelerate the process of agricultural modernization in China.
The notes will mature on Oct. 1, 2024, according to the statement.
Earlier this month, Barron's published a report stating Pinduoduo enables people to maximize their spending in good times and bad. The company runs an e-commerce platform that facilitates group buying. The more people you get to buy something, the lower the price.