As of January 2, the notes had an aggregate principal amount of $301,448,000 outstanding.
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Nio (NYSE: NIO) announced today that it is notifying holders of its 0.00 percent convertible senior notes due 2026 of their right to require the company to repurchase all or a portion of the notes on February 1 for cash.
The repurchase right expires at 5:00 pm New York time on Wednesday, January 31, Nio said.
The repurchase right entitles the holder of the notes to require Nio to repurchase all of such holder’s notes or any portion thereof in integral multiples of $1,000 in principal amount.
The repurchase price of such notes will be equal to 100 percent of the principal amount of the notes to be repurchased, plus any accrued and unpaid additional interest as of February 1.
As of January 2, 2024, $301,448,000 aggregate principal amount of the notes was outstanding.
If all of the outstanding notes are surrendered for repurchase through the exercise of the repurchase right, the aggregate cash purchase price would be $301,448,000, according to Nio’s statement.
The opportunity for noteholders to exercise the repurchase right commences at 9:00 am, New York City time, on January 3 and will end at 5:00 pm, New York City time, on Wednesday, January 31.
Convertible notes, also commonly written as convertible bonds, allow holders to convert into shares of a company over a future period of time.
Typically, a company will pay the principal and interest to the holders of convertible notes at maturity if they do not convert these notes into shares.
Nio made a similar move in January 2022, although none of the noteholders exercised their repurchase rights at that time and no notes were surrendered for repurchase.
Notably, Nio closed a $2.2 billion strategic equity investment from Abu Dhabi government fund CYVN Investments RSC Ltd in late December.
In July, CYVN made a $738.5 million strategic equity investment in Nio and acquired a portion of the company’s class A ordinary shares from an affiliate of Tencent for total consideration of $350 million. Both transactions closed in July.
With the completion of the $2.2 billion strategic equity investment, CYVN beneficially owns a total of about 20.1 percent of Nio’s total issued and outstanding shares.
