Best Offers Up to $175 Million in Senior Convertible Notes; Stock Rises 2%

An entity of Alibaba Group has expressed interest in acquiring $100 million of the senior convertible notes in the logistics provider.

Author: Anthony Russo   

The stock of Best Inc. (NYSE: BEST) ended nearly 2 percent higher on Thursday after the company, which provides smart supply chain solutions and logistics, announced an offering of senior convertible notes of up to $175 million. 

The company, based in Hangzhou, said in a statement after markets closed on Wednesday that the notes will mature on Oct. 1, 2024, while the interest and conversion rates have yet to be determined. Purchasers will have an option to buy up to an additional $25 million in notes, according to the report. The notes will be convertible into American depositary shares.

An entity of Alibaba Group Holding Ltd. (NYSE: BABA) has expressed interest in purchasing a minimum of $100 million of the notes, Best said in its statement. The Chinese e-commerce giant has previously invested in Best Inc., along with a number of other logistics providers in the country.

In response to the announcement, shares in Best rose 10 cents to $5.53 apiece on Thursday.

The proceeds from the offering will be used to pay the cost of the capped call transactions, Best said, and the rest will be invested in general corporate purposes.

Last month, Best reported revenue of $1.3 million for the second quarter, up 31 percent year-over-year. Net loss narrowed to $3.3 million, compared with $14.2 million a year ago.