ZTO Express plans $1.5 billion convertible bond issue, term sheet shows

ZTO Express (Cayman)

04/02/2026 10:35

SINGAPORE/SYDNEY, Feb 4 (Reuters) - Chinese delivery company ZTO Express (Cayman) Inc 2057.HK is raising $1.5 billion from an offering of senior unsecured convertible bonds due to mature in 2031, according to a term sheet seen by Reuters on Wednesday.

The notes are offered with an indicated coupon of between 0.55% and 1.05%, with semi-annual cash interest payments on March 1 and September 1, the term sheet showed.

They are expected to be issued at par and will be convertible into ZTO's Hong Kong-listed shares at an initial conversion premium of about 35-40% over a reference share price of HK$179.10, based on Wednesday's closing price.

The notes are scheduled to mature on March 1, 2031, and include a holder put option on March 1, 2029, at 100% of principal plus accrued interest, the sheet showed.

ZTO said it intends to use net proceeds to refinance and fund near-term share repurchases, fund a concurrent share repurchase and the premium for a capped call transaction as well as general corporate purposes.

The filing said the concurrent repurchase will be made under the company's existing share buyback programme through to June 30 this year.

The capped call is intended to reduce potential dilution from conversion, subject to a cap, the term sheet said.

Citi C.N and Goldman Sachs GS.N are joint global coordinators, joint lead managers and joint bookrunners.

(Reporting by Yantoultra Ngui in Singapore and Scott Murdoch in Sydney
Additional reporting by Rajasik Mukherjee in Bengaluru
Editing by David Goodman)

((Yantoultra.Ngui@thomsonreuters.com;))