YY Inc. and Dangdang Inc. both received buyout offers from top
executives on Thursday, the latest Chinese businesses to receive
such proposals.
In YY's case, the offer values the company at about $3.7
billion. Dangdang's offer values the company at about $630
million.
YY Chairman Jun Lei and Chief Executive David Xueling Li have
proposed to buy all shares outstanding they don't already own for
$68.50 per American depositary share, representing a 17.4% premium
on the trading price on July 8.
The buyer group already owns about 35.7% of the issued and
shares outstanding and has 75.1% of the voting power of the
company. It intends to fund the buyout with debt and equity
capital.
Guangzhou-based YY is a social platform that lets users text and
video each other. It joins the ranks of Chinese companies that have
received similar proposals recently, such as JA Solar Holdings Co.,
Taomee Holdings Ltd., Renren Inc. and 21Vianet Group Inc.
Beijing-based Dangdang Inc, a business-to-consumer e-commerce
company, received an offer from Chairwoman Peggy Yu Yu and Chief
Executive Guoqing Li. Their offer of $7.812 in cash per American
depositary share is a 20% premium from July 8. Dangdang's buyer
group owns 39.5% of the company's shares and have 83.5% of the
voting power.
A flood of going-private offers have been made recently, far
outnumbering the five approaches of U.S-listed Chinese firms that
were made from January to May of this year, according to Deal Point
Data. Of those five approaches, three were management-led.
The Chinese stock market had been surging, though stocks have
fallen steeply in recent weeks and have remained volatile. Dangdang
saw its shares plunge 30% in the past two weeks.
Write to Angela Chen at angela.chen@dowjones.com
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