Micro-lending platform Qudian plans to offer up to USD 250 million (RMB 1.72 billion) in convertible notes, which would be due in 2026, according to a filing.
Some of the terms of the debt instrument—including the initial conversion rate and interest rate—have not been finalized. The company also intends to grant initial purchases an option to buy up to an additional USD 37.5 million (RMB 258 million) within 30 days.
Qudian says it plans to use the funds raised to invest in complementary businesses, develop its platform, and potentially repurchase shares. The company went public on Nasdaq in October 2017, raising USD 900 million (RMB 6.2 billion).
The company also recently counted Ant Financial as a shareholder, before the Alibaba-affiliated fintech giant relinquished its stake in April.
Once a hotspot of growth, China’s online lending economy ground to a halt last year after the Chinese government began regulating it to combat fraud and speculation.
Half of the country’s online P2P platforms closed down in 2018, and 70% of remaining players are expected to disappear by the end of 2019, according to estimates by research firm Yingcan Group cited by Technode.
Beijing has also implemented a RMB 500 million (USD 74.5 million) capital requirement for nationwide P2P-lenders. In April, just seven of 1,021 platforms operating today meet this minimum, according to Bloomberg.
Meanwhile, the Chinese government is trialing a pilot registration program for P2P companies, which it plans to roll out to the entire country by 2020.