Shanghai-based Chinese online game developer Shanda Games Ltd. says that it has received a preliminary non-binding proposal on January 27th from its controlling shareholder Shanda Interactive Entertainment Ltd. and an affiliate of Primavera Capital to take the NASDAQ-listed company private.
The investors, who together already own around a 76.2% stake of Shanda Games, plans to acquire the company at US$6.90 per American Depositary Shares (ADS), a 21.3% premium to the company’s volume-weighted average price on January 24, or a premium of 44.4% to the volume-weighted average price during the last 30 trading days.
The privatization deal values Shanda Games at approximately US$1.9 billion.
The investors say that they will finance the deal with a combination of their own equity and third-party debt.
Shanda Games says its board is reviewing and evaluating the proposal.
In October 2011, Shanda Interactive Entertainment was taken private by its CEO and chairman, Chen Tianqiao in a US$2.3 billion deal.