China-based real estate firm SouFun is set to receive between $400m and $700m from IDG Capital Partners, an investment affiliate of media firm International Data Group, China Money Network reported yesterday.
Asset management firm Carlyle Group and SouFun’s management, led by chief executive and founder Vincent Mo, have also committed funds.
The investors will spend half the capital on newly issued class A shares at $29.25 each, equating to a 3.5 premium to the volume-weighted average trading price for 20 days leading up to September 16.
The remaining half will be issued as convertible notes with an annual interest rate of 1.5%. The notes may be converted to class A shares in seven years, at a price per share of $35.8 (a 122.5% increase of the purchase price of the new class A shares).
SouFun operates a portal called Fang.com that offers real estate information covering 370 cities across China. The cash will enable SouFun to expand the platform to offer real estate financial services, including reselling, renting and furnishing.
SouFun raised a $1m series A round from IDG in 1999, followed by a $5m series B from investment firm Goldman Sachs in 2000, according to Crunchbase, though the rounds are unsourced and could not be verified.
A company filing listing SouFun’s backers names IDG (holding a 2.8% stake), conglomerate Fosun International (4.4%), and financial services firm Fidelity Management & Research (2.5%), as well as a range of investment and venture capital firms. Goldman Sachs is not named in the filing.
Vincent Mo said: “With the new investment, the company will be in a better position to strengthen its transformation. The company will expand aggressively to more cities and rapidly increase its market share in existing cities with its new transaction and financial service business lines.”