Yatsen Holding Limited (YSG.US) announced on March 11 that it plans to issue $120 million in privately placed, RMB-denominated convertible preferred notes. The subscribers include the company’s founder, chairman, and CEO Mr. Huang Jinfeng, alongside a special purpose vehicle formed jointly with Trustar Capital, the private equity arm of CITIC Capital. This joint subscription demonstrates strong confidence in the company’s long-term value from both its founder and a leading private equity institution.
According to the announcement, the convertible bond offering will be executed in two equal tranches and will be accompanied by warrants to purchase the company’s Class A ordinary shares. The notes carry an annual coupon rate of 1.5%, with an initial conversion price set at $4.63 per ADS, representing a 20% premium over the volume-weighted average price of the ADSs for the five consecutive trading days prior to the signing of the warrant purchase agreement.
Proceeds from the offering will primarily be allocated to future product development, global supply chain integration, overseas market expansion, strategic mergers and acquisitions, and other corporate purposes, further driving the company’s sustained growth and strengthening its core competitiveness.
Trustar Capital, the private equity investment business under CITIC Capital Holdings, focuses on global buyout opportunities and has completed over 100 investments across China, Japan, the United States, and Europe, with total assets under management reaching $10.2 billion. The firm has extensive experience in the beauty industry, such as its controlling stake in Axilone, one of the world’s largest cosmetics packaging suppliers, which serves numerous high-end international brands. Trustar also has a broad presence in pharmaceuticals and biotechnology, which can provide critical support for Yatsen’s cutting-edge product R&D. Additionally, the firm possesses strong expertise in driving corporate digital transformation.
In the announcement, Mr. Huang Jinfeng stated, "This additional investment reflects my firm belief in Yatsen’s long-term value and the unwavering commitment of our management team to strategic execution. Amid a changing market environment, we remain focused on advancing our multi-brand strategy. I am honored to bring in Trustar Capital’s top-tier resources and deep industry expertise. Moving forward, both parties will further strengthen strategic synergies and create long-term sustainable value for shareholders through resource integration and complementary advantages."
Mr. Zhang Yichen, Chairman of Trustar Capital, also expressed strong confidence in Yatsen, stating, "We highly commend the determination shown by Yatsen during its strategic transformation, particularly its sustained focus in recent years on product portfolio optimization, organizational enhancement, and brand building, which has fortified the company’s long-term competitive moat. This investment also reflects our deep trust in Mr. Huang Jinfeng and his management team’s exceptional global vision and ability to integrate worldwide brand resources. We look forward to starting from this collaboration to deeply empower Yatsen, assisting the company in achieving its leap from a 'Chinese emerging player' to a 'global beauty group' through cross-border M&A and integration of high-quality global resources."
This partnership represents not only a capital injection but also a strategic, in-depth collaboration. In the future, Trustar Capital will leverage its global network and industry resources to help Yatsen achieve efficient strategic synergies across the beauty industry value chain. Yatsen, in turn, will draw on Trustar’s extensive experience in cross-border M&A and post-investment integration to steadily advance its overseas expansion strategy and move decisively toward its long-term vision of becoming a "world-class pioneer in beauty innovation."
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