Photo:VCG

Chinese e-commerce giant Pinduoduo plans to raise 875 million US dollars through a convertible senior note offering to fund its business expansion.

Pinduoduo said Tuesday it intends to grant the initial purchasers of its unsecured notes a 13-day option to buy further up to 125 million US dollars, potentially raising the total financing to 1 billion US dollars.

The company plans to use the fund for research and development and construction of technology infrastructure for modern agriculture.

Last year, the fast-growing marketplace reported a farm produce sales of 65.3 billion yuan (9.2 billion US dollars), becoming one of China's leading e-commerce platforms for agricultural products.

The notes will mature on October 1, 2024. But starting Oct. 1, 2022, the company can use cash to redeem all or part of the convertible notes if prices of its American Depositary Shares have been at least 130 percent of the conversion price on each of at least 20 trading days within 30 consecutive trading days.

On Monday in Nasdaq, shares of Pinduoduo closed at 33.82 US dollars with a market capitalization of 39.3 billion US dollars, ranking as China's 5th largest listed Internet companies.

Its shares have surged over 50 percent so far this year, one of the best-performing tech firms on Nasdaq.

Founded in 2015, Pinduoduo is known for offering group buying deals with big discounts and enjoys a huge consumer base in rural areas and small cities.

In the 12-month period ending June 30, its gross merchandise volume (GMV) reached 709.1 billion yuan, an annual increase of 171 percent, while its active buyers grew by 41 percent to 483.2 million, according to its quarterly financial report released in August.