Qifu Technology, Inc. Announces Completion of Offering of US$690 Million Cash-par Settled Convertible Senior Notes

Rhea-AI Summary

Qifu Technology (NASDAQ: QFIN; HKEx: 3660) has successfully completed its offering of convertible senior notes worth US$690 million due 2030, including the full exercise of a US$90 million additional purchase option. The notes, offered to qualified institutional buyers under Rule 144A, will bear interest at 0.50% annually.

The company plans to use the proceeds for repurchasing ADSs and class A ordinary shares through a newly established March 2025 Share Repurchase Plan, supplementing their existing November 2024 plan. The initial conversion rate is 16.7475 ADSs per US$1,000 of notes, equivalent to US$59.71 per ADS.

The offering includes an immediate US$230 million ADS repurchase executed concurrently with the pricing, and is expected to be immediately accretive to 2025 earnings per ADS.

Positive

• US$690 million successful capital raise through convertible notes
• Immediate US$230 million share repurchase program implementation
• Expected immediate accretion to 2025 earnings per ADS
• Low interest rate of 0.50% annually on the notes

Negative

• Increased debt liability with US$690 million in convertible notes
• Potential future dilution if notes are converted to ADSs

Insights

Financial Analyst

Qifu Technology's $690 million convertible note offering represents a strategically sound capital allocation move with multiple benefits for shareholders. The 0.50% interest rate is remarkably low, minimizing interest expense while substantially increasing financial flexibility. The $59.71 conversion price represents a 24% premium to current share prices, protecting against immediate dilution while allowing the company to secure advantageous financing terms.

The company's decision to allocate $230 million for immediate share repurchases demonstrates management's conviction that shares are undervalued at current levels. By implementing this share count reduction while simultaneously announcing the new repurchase program on top of the existing November 2024 plan, Qifu is creating a powerful tailwind for EPS growth. The cash-par settlement mechanism further prevents dilution upon potential conversion.

This transaction is particularly well-structured from a financial engineering perspective - Qifu effectively secured cheap financing that won't dilute shareholders unless the stock appreciates substantially, while simultaneously reducing share count through repurchases to drive EPS accretion. For an AI-powered Credit-Tech platform where capital flexibility is essential for growth opportunities, this move strengthens Qifu's position while returning value to shareholders.

SHANGHAI, China, March 27, 2025 (GLOBE NEWSWIRE) -- Qifu Technology, Inc. (NASDAQ: QFIN; HKEx: 3660) (“Qifu Technology” or the “Company”), a leading AI-empowered Credit-Tech platform in China, today announced the completion of its offering of convertible senior notes (the “Notes Offering”) in an aggregate principal amount of US$690 million due 2030 (the “Notes”), including the initial purchasers’ full exercise of option to purchase an additional US$90 million principal amount of the Notes. The Notes have been offered to persons reasonably believed to be qualified institutional buyers pursuant to Rule 144A under the Securities Act of 1933, as amended (the “Securities Act”).

The Company plans to use the net proceeds from the Notes Offering for repurchasing the American depositary shares (“ADSs”) and/or class A ordinary shares of the Company concurrently with the pricing of the Notes Offering and from time to time after the pricing of the Notes Offering pursuant to a newly established share repurchase plan (the “March 2025 Share Repurchase Plan”) authorized by the board of directors of the Company. The March 2025 Share Repurchase Plan will run in addition to the Company’s existing share repurchase plan announced in November 2024.

The Company expects the offering to be immediately accretive to 2025 earnings per ADS upon closing, facilitated by (i) the execution of the repurchase of ADSs concurrently with the pricing of the Notes Offering with an aggregate value of approximately US$230 million from certain purchasers of the Notes in off-market privately negotiated transactions effected through one of the initial purchasers or its affiliates, as the Company’s agent, and (ii) the cash-par conversion settlement mechanism of the Notes.

The Notes will be general unsecured obligations of the Company and bear interest at a rate of 0.50% per year, payable semiannually in arrears on April 1 and October 1 of each year, beginning on October 1, 2025. The Notes will mature on April 1, 2030 unless repurchased, redeemed, or converted in accordance with their terms prior to such date.

The initial conversion rate of the Notes is 16.7475 ADSs, per US$1,000 principal amount of the Notes, which is equivalent to an initial conversion price of approximately US$59.71 per ADS.

The Notes, the ADSs deliverable upon conversion of the Notes, if any, and the class A ordinary shares represented thereby or deliverable upon conversion of the Notes in lieu thereof have not been registered under the Securities Act, or any securities laws of any other places. They may not be offered or sold within the United States or to U.S. persons, except to persons reasonably believed to be qualified institutional buyers in reliance on the exemption from registration provided by Rule 144A under the Securities Act.

This press release shall not constitute an offer to sell or a solicitation of an offer to purchase any securities, nor shall there be a sale of the securities in any state or jurisdiction in which such an offer, solicitation or sale would be unlawful.

About Qifu Technology

Qifu Technology is a leading AI-empowered Credit-Tech platform in China. By leveraging its sophisticated machine learning models and data analytics capabilities, the Company provides a comprehensive suite of technology services to assist financial institutions and consumers and SMEs in the loan lifecycle, ranging from borrower acquisition, preliminary credit assessment, fund matching and post-facilitation services. The Company is dedicated to making credit services more accessible and personalized to consumers and SMEs through Credit-Tech services to financial institutions.

For more information, please visit: https://ir.qifu.tech.

Safe Harbor Statement

Any forward-looking statements contained in this press release are made under the “safe harbor” provisions of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements can be identified by terminology such as “will,” “expects,” “anticipates,” “future,” “intends,” “plans,” “believes,” “estimates” and similar statements. Qifu Technology may also make written or oral forward-looking statements in its periodic reports to the U.S. Securities and Exchange Commission (the “SEC”), in announcements made on the website of The Stock Exchange of Hong Kong Limited (the “Hong Kong Stock Exchange”), in its annual report to shareholders, in press releases and other written materials and in oral statements made by its officers, directors or employees to third parties. Statements that are not historical facts, including the Company’s beliefs and expectations, are forward-looking statements. Forward-looking statements involve inherent risks and uncertainties. A number of factors could cause actual results to differ materially from those contained in any forward-looking statement, which factors include but not limited to the following: the Company’s growth strategies, the Company’s cooperation with 360 Group, changes in laws, rules and regulatory environments, the recognition of the Company’s brand, market acceptance of the Company’s products and services, trends and developments in the Credit-Tech industry, governmental policies relating to the Credit-Tech industry, general economic conditions in China and around the globe, and assumptions underlying or related to any of the foregoing. Further information regarding these and other risks and uncertainties is included in Qifu Technology’s filings with the SEC and the announcements on the website of the Hong Kong Stock Exchange. All information provided in this press release is as of the date of this press release, and Qifu Technology does not undertake any obligation to update any forward-looking statement, except as required under applicable law.

For further information, please contact:

Qifu Technology
E-mail: ir@360shuke.com

FAQ

What is the size and terms of QFIN's 2030 convertible notes offering?

QFIN's convertible notes offering totals US$690 million, due 2030, with a 0.50% annual interest rate and initial conversion price of US$59.71 per ADS.

How will QFIN use the proceeds from the March 2025 convertible notes?

QFIN will use the proceeds to repurchase ADSs and class A ordinary shares through their new March 2025 Share Repurchase Plan, including an immediate US$230 million repurchase.

What is the conversion rate for QFIN's 2030 convertible notes?

The initial conversion rate is 16.7475 ADSs per US$1,000 principal amount of notes, equivalent to US$59.71 per ADS.

How will QFIN's March 2025 convertible notes impact earnings?

The offering is expected to be immediately accretive to QFIN's 2025 earnings per ADS upon closing.