Sina enters $2.59B ‘Going Private’ transaction with New Wave Holdings
Sina (SINA) announced that it has entered into an agreement and plan of merger with New Wave Holdings and New Wave Merger sub, a wholly owned subsidiary of parent, pursuant to which parent will acquire all of the company’s outstanding ordinary shares not currently owned by parent and its affiliates in an all-cash transaction implying an equity value of the company of approximately $2.59B for all the ordinary shares.
Parent is a wholly owned subsidiary of New Wave MMXV, a British Virgin Islands company controlled by Charles Chao, chairman and CEO of the company.
Pursuant to the merger agreement, at the effective time of the merger, each ordinary share issued and outstanding immediately prior to the effective time will be cancelled and cease to exist in exchange for the right to receive $43.30 in cash per ordinary share without interest, other than shares held by the chairman, New Wave and any of their respective affiliates.
The per share merger consideration represents a premium of approximately 18.1% to the closing price of the company’s ordinary shares on July 2, the last trading day prior to the company’s announcement of its receipt of the preliminary non-binding “going-private” proposal from New Wave on July 6, and premiums of approximately 23.6% and 28.6% to the volume-weighted average traded price of the company’s ordinary shares during the last one month and three months, respectively, prior to and including July 2.
The per share merger consideration also represents an increase of approximately 5.6% over the $41 per ordinary share initially offered in the “going-private” proposal from New Wave.
The merger consideration will be funded through a combination of certain committed term loan facilities obtained by New Wave from China Minsheng Banking and cash contribution by the chairman and New Wave.
The company’s board of directors, acting upon the unanimous recommendation of a committee of independent directors established by the board, approved the merger agreement and the merger and resolved to recommend that the company’s shareholders vote to authorize and approve the merger agreement and the merger.
The merger is currently expected to close during the Q1 of 2021 and is subject to customary closing conditions, including the approval of the merger agreement by the affirmative vote of shareholders representing at least two-thirds of the voting power of the outstanding shares of the company present and voting in person or by proxy at a meeting of the company’s shareholders.
If completed, the merger will result in the company becoming a privately held company and its ordinary shares will no longer be listed on Nasdaq.
SINA is up $2.46 to $42.65
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