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 Executives at several Chinese companies have been betting on higher
valuations back home, but the economy that accounts for much of
their business has been slowing.
Shares of Qihoo, which listed in the United States in 2011, were up
2.7 percent at $73.78 in premarket trading on Friday, below the
offer of $77 for each American Depositary Share.
The offer represents a 16.6 pct premium to the stock's closing on
June 16, the day before the company said it had received a buyout
offer from a consortium led by Chief Executive Hongyi Zhou at $77
per ADS.
The company said on Friday entities controlled by Zhou and Chairman
Xiangdong Qi agreed to vote all their shares in favor of the deal.
Their combined stake represents about 61 percent of the voting
rights attached to the outstanding shares.
It was not immediately clear whether Zhou was part of the consortium
that is taking Qihoo private.
In deals collectively worth $40 billion, some 33 mainland China
companies have unveiled plans this year to be taken private and
delist from the United States as of mid-November, according to
Thomson Reuters data.
Chinese firms that have been taken private include Shanda Games Ltd
and medical R&D services provider WuXi PharmaTech.
Online dating service Jiayuan.com, dubbed the 'Match.com of China,'
is in the process of being taken private.
In November, e-commerce giant Alibaba Group Holding Ltd offered to
take Youku Tudou Inc, popularly known as "China's YouTube", private
for about $3.7 billion.
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The Qihoo deal, which is currently expected to close during the
first half of 2016, includes about $1.6 billion of debt.
The consortium taking the company private includes Citic Guoan,
Golden Brick Silk Road Capital, Sequoia Capital China, Taikang Life
Insurance, Ping An Insurance, Sunshine Insurance, New China Capital,
Huatai Ruilian, Huasheng Capital or their affiliated entities.
J.P. Morgan Securities (Asia Pacific) Ltd is the financial adviser
to the company's special committee. Skadden, Arps, Slate, Meagher &
Flom LLP is U.S. legal counsel to the committee.
Huatai United Securities Co Ltd is the consortium's financial
adviser and Kirkland & Ellis LLP is the U.S. legal counsel.
(Reporting by Sruthi Ramakrishnan and Devika Krishna Kumar in
Bengaluru; Editing by Sriraj Kalluvila)
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