Bilibili Inc. Announces Repurchase Right Notification for 0.50% Convertible Senior Notes due 2026

Rhea-AI Summary

Bilibili Inc. (BILI) has announced a repurchase right for holders of its 0.50% Convertible Senior Notes due 2026. Noteholders can require Bilibili to repurchase all or a portion of their notes for cash on December 1, 2024. The repurchase price will be 100% of the principal amount plus accrued and unpaid interest. The repurchase right can be exercised from October 29, 2024, to November 27, 2024.

As of October 21, 2024, there was US$432,407,000 in aggregate principal amount of Notes outstanding. If all Notes are surrendered for repurchase, the total cash purchase price will be US$432,407,000. Bilibili will file a Tender Offer Statement on Schedule TO with the SEC, and detailed information will be available through the Depository Trust Company and Deutsche Bank Trust Company Americas, the paying agent.

Positive

• Bilibili is offering noteholders the option to cash out their investment at par value
• The repurchase offer provides liquidity for noteholders

Negative

• If all notes are repurchased, Bilibili will need to pay out US$432,407,000 in cash
• The repurchase could potentially impact Bilibili's cash reserves

Insights

Financial Analyst

This announcement regarding Bilibili's 0.50% Convertible Senior Notes due 2026 is significant for investors. The company is offering noteholders the option to sell their notes back at 100% of the principal amount plus accrued interest. With $432,407,000 in outstanding notes, this could potentially impact Bilibili's cash position substantially if many holders exercise this right.

The repurchase offer is a standard feature of many convertible notes, providing an early exit option for investors. However, the timing and Bilibili's ability to fund potential repurchases are important factors to consider. Given Bilibili's recent financial performance and the challenging macroeconomic environment in China, this event warrants close attention.

Investors should monitor the uptake of this repurchase offer closely, as it could signal market sentiment towards Bilibili's long-term prospects. A high repurchase rate might indicate a lack of confidence in the company's ability to grow into its valuation, while a low rate could suggest investor optimism about future stock price appreciation.

Legal Expert

The repurchase right notification for Bilibili's convertible notes is a routine legal procedure, but it carries important implications. The company is meticulously following SEC regulations by filing a Tender Offer Statement on Schedule TO and providing detailed instructions to noteholders.

Key legal points to note:

• The repurchase right is optional for noteholders
• The repurchase price is set at 100% of principal plus accrued interest
• Strict deadlines and procedures are in place for exercising or withdrawing the repurchase right
• The company explicitly states it's not making recommendations to holders

This process demonstrates Bilibili's compliance with securities laws and its contractual obligations. However, investors should be aware that if a significant portion of notes are repurchased, it could impact the company's capital structure and potentially trigger other covenants or agreements. The legal implications extend beyond this specific transaction and could affect Bilibili's overall financial flexibility.

SHANGHAI, Oct. 21, 2024 (GLOBE NEWSWIRE) -- Bilibili Inc. (“Bilibili” or the “Company”) (Nasdaq: BILI and HKEX: 9626), an iconic brand and a leading video community for young generations in China, today announced that it is notifying holders of its 0.50% Convertible Senior Notes due 2026 (CUSIP No. 090040AF3) (the “Notes”) that, pursuant to the Indenture dated as of November 23, 2021 (the “Indenture”) relating to the Notes by and between the Company and Deutsche Bank Trust Company Americas, as trustee, each holder has the right, at the option of such holder, to require the Company to repurchase all of such holder’s Notes or any portion thereof that is an integral multiple of US$1,000 principal amount for cash on December 1, 2024 (the “Repurchase Right”). Holders of the Notes may exercise the Repurchase Right from 12:01 a.m., New York City time, on Tuesday, October 29, 2024 until 5:00 p.m., New York City time, on Wednesday, November 27, 2024.

As required by rules of the United States Securities and Exchange Commission (the “SEC”), the Company will file a Tender Offer Statement on Schedule TO today. In addition, documents specifying the terms, conditions, and procedures for exercising the Repurchase Right will be available through the Depository Trust Company and the paying agent, which is Deutsche Bank Trust Company Americas. None of the Company, its board of directors, or its employees has made or is making any representation or recommendation to any holder as to whether to exercise or refrain from exercising the Repurchase Right.

The Repurchase Right entitles each holder of the Notes to require the Company to repurchase all of such holder’s Notes, or any portion thereof that is an integral multiple of US$1,000 principal amount. The repurchase price for such Notes will be an amount in cash equal to 100% of the principal amount of the Notes to be repurchased, plus accrued and unpaid interest to, but excluding, December 1, 2024, which is the date specified for repurchase in the Indenture (the “Repurchase Date”), subject to the terms and conditions of the Indenture and the Notes. The Repurchase Date is an interest payment date under the terms of the Indenture and the Notes. As December 1, 2024 is a Sunday, pursuant to the Indenture and the Notes, on Monday, December 2, 2024, which is the next succeeding business day, the Company will pay accrued and unpaid interest on all of the Notes through November 29, 2024 to all holders who were holders of record as of close of business on Friday, November 15, 2024, regardless of whether the Repurchase Right is exercised with respect to such Notes, with the same force and effect as if paid on December 1, 2024 and no interest shall accrue in respect of the delay. As a result, on the Repurchase Date, there will be no accrued and unpaid interest on the Notes. As of October 21, 2024, there was US$432,407,000 in aggregate principal amount of the Notes outstanding. If all outstanding Notes are surrendered for repurchase through exercise of the Repurchase Right, the aggregate cash purchase price will be US$432,407,000.

In order to exercise the Repurchase Right, a holder must follow the transmittal procedures set forth in the Company’s Repurchase Right Notice to holders (the “Repurchase Right Notice”), which is available through the Depository Trust Company and Deutsche Bank Trust Company Americas. Holders may withdraw any previously tendered Notes pursuant to the terms of the Repurchase Right at any time prior to 5:00 p.m., New York City time, on Wednesday, November 27, 2024, which is the second business day immediately preceding the Repurchase Date. If a holder has tendered any Notes pursuant to the Repurchase Right, such Notes cannot be converted unless the holder withdraws the tender in accordance with the terms of the Indenture.

This press release is for information only and is not an offer to purchase, a solicitation of an offer to purchase, or a solicitation of an offer to sell the Notes or any other securities of the Company. The offer to purchase the Notes will be only pursuant to, and the Notes may be tendered only in accordance with, the Company’s Repurchase Right Notice dated October 21, 2024 and related documents.

Holders of the Notes should refer to the Indenture for a complete description of repurchase procedures and direct any questions concerning the mechanics of repurchase to the Trustee by contacting Deutsche Bank Trust Company Americas. Holders of Notes may request the Company’s Repurchase Right Notice from the paying agent, at Deutsche Bank Trust Company Americas, c/o DB Services Americas Inc., 5022 Gate Parkway Suite 200, MS JCK01-218, Jacksonville, FL 32256.

HOLDERS OF NOTES AND OTHER INTERESTED PARTIES ARE URGED TO READ THE COMPANY’S TENDER OFFER STATEMENT ON SCHEDULE TO, REPURCHASE RIGHT NOTICE, AND OTHER RELEVANT DOCUMENTS FILED WITH THE SEC WHEN THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT BILIBILI INC. AND THE REPURCHASE RIGHT.

Materials filed with the SEC will be available electronically without charge at the SEC’s website, http://www.sec.gov. Documents filed with the SEC may also be obtained without charge at the Company’s investor relations website, http://ir.bilibili.com.

About Bilibili Inc.

Bilibili is an iconic brand and a leading video community with a mission to enrich the everyday lives of young generations in China. Bilibili offers a wide array of video-based content with All the Videos You Like as its value proposition. Bilibili builds its community around aspiring users, high- quality content, talented content creators and the strong emotional bonds among them. Bilibili pioneered the “bullet chatting” feature, a live comment function that has transformed our users’ viewing experience by displaying the thoughts and feelings of audience members viewing the same video. The Company has now become the welcoming home of diverse interests among young generations in China and the frontier for promoting Chinese culture across the world.

For more information, please visit: http://ir.bilibili.com.

For investor and media inquiries, please contact:

In China:
Bilibili Inc.
Juliet Yang
Tel: +86-21-2509-9255 Ext. 8523
E-mail: ir@bilibili.com

Piacente Financial Communications
Helen Wu
Tel: +86-10-6508-0677
E-mail: bilibili@tpg-ir.com

In the United States:
Piacente Financial Communications
Brandi Piacente
Tel: +1-212-481-2050
E-mail: bilibili@tpg-ir.com

FAQ

What is the repurchase price for Bilibili's (BILI) 0.50% Convertible Senior Notes due 2026?

The repurchase price is 100% of the principal amount of the Notes, plus accrued and unpaid interest to, but excluding, December 1, 2024.

When can holders exercise the repurchase right for Bilibili's (BILI) convertible notes?

Holders can exercise the repurchase right from October 29, 2024, until 5:00 p.m., New York City time, on November 27, 2024.

What is the total outstanding principal amount of Bilibili's (BILI) convertible notes as of October 21, 2024?

As of October 21, 2024, there was US$432,407,000 in aggregate principal amount of the Notes outstanding.

What happens if all Bilibili (BILI) noteholders exercise their repurchase right?

If all outstanding Notes are surrendered for repurchase, the aggregate cash purchase price will be US$432,407,000.