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iQIYI Announces US$500 Million Private Placement of Convertible Notes with PAG

Tuesday, August 30, 2022

(Press Release) - iQIYI, Inc. (Nasdaq: IQ) ("iQIYI" or the "Company"), an innovative market-leading online entertainment service in China, today announced that the Company has entered into a definitive agreement with PAG Asia, PAG Pegasus and/or their affiliates (collectively, the "Investors"), a leading investment firm in Asia, pursuant to which the Investors will subscribe for an aggregate amount of US$500 million convertible notes (the "Notes") to be issued by the Company. The Company has granted the Investors an option, exercisable within two months from the closing date of the transaction, to subscribe for an additional amount of up to US$50 million of the Notes, under the same terms and conditions. The transaction is expected to close in the fourth quarter of 2022, subject to closing conditions.

The Notes will bear an interest rate of 6% per annum and will mature on the fifth anniversary of the issuance date. The Notes may be convertible into the Company's American depositary shares, each currently representing seven Class A ordinary shares of the Company, at the holder's option and subject to the terms of the Notes, at a conversion premium of 20% above the volume weighted average price of the 20 trading days prior to, and including, August 29, 2022. Holders of the Notes have the right to require the Company to repurchase for cash all or part of their Notes, at a repurchase price equal to 120% and 130% of the principal amount of the Notes on or shortly after the third anniversary of the issuance date and the fifth anniversary of the issuance date, respectively. Holders also have the right to require the Company to repurchase for cash all or part of their Notes in the event of certain fundamental changes. Upon closing of the transaction and satisfaction of certain condition, PAG Asia shall be entitled to appoint one member to the board of directors of the Company.


View full announcement here