New York Stock Exchange-listed Chinese real estate Internet portal SouFun Holdings Limited says that IDG Capital Partners and the Carlyle Group have agreed to invest between US$400 million to US$700 million in total to help the company transition and grow in China.
According to a company announcement, IDG and Carlyle will subscribe to SouFun’s newly issued class A ordinary shares at US$29.25 per share, or US$5.85 per American Depository Shares (ADS), representing a 3.5% premium to the volume-weighted average trading price before the announcement.
Half of the investment will be via subscription of convertible notes, which bears an annual interest of 1.5% and can be converted into class A ordinary shares at the price equal to 122.5% of the per share purchase price of the new class A ordinary shares in seven years after its issuance.
"With the new investment, the company will be in a better position to strengthen its transformation. The company will expand aggressively to more cities and rapidly increase its market share in existing cities with its new transaction and financial service business lines," says Vincent Mo, chairman and CEO of SouFun’s main portal, Fang.com.
In August, IDG, Carlyle and SouFun’s founder and CEO Vincent Mo said they had agreed to invest as much as US$1 billion in SouFun at US$7.45 per ADS. Part of that investment was also structured as convertible notes.
SouFun provides marketing, e-commerce, listing, financing and other services for China’s real estate and home-related sectors.
SouFun currently maintains about 100 offices to focus on local market needs and its websites, mobile apps and database contain real estate related data covering more than 370 cities in China.