Hangzhou, Zhejiang province-based Chinese e-commerce giant Alibaba Group has offered to buy out the 72% shares it doesn’t already own in NASDAQ-listed digital mapping and navigation firm AutoNavi Holdings Limited for US$1.1 billion, according to a regulatory filing submitted to the U.S. Securities and Exchange Commission (SEC).
Alibaba is offering US$21 in cash per American Depositary Shares (ADS) for the Beijing-based AutoNavi. The price represents a 27% premium to AutoNavi’s closing price of US$16.54 before the announcement.
The deal values AutoNavi at US$1.58 billion.
In May 2013, Alibaba acquired a 28% stake in AutoNavi for US$294 million.
AutoNavi received US$40 million in venture capital funding in 2006 from a group of investors including Walden International, Sequoia Capital and Legend Capital. The company listed on NASDAQ in 2010.
"We believe that Alibaba is uniquely positioned to offer superior value to AutoNavi’s shareholders based on our complementary, rather than competitive, business strategies and the potential synergies we can achieve," Joseph Tsai, Alibaba’s executive vice chairman, wrote in the proposal letter.
AutoNavi says the board has received Alibaba’s proposal letter and intends to form a committee of independent directors to consider the transaction.
Founded in 2001, AutoNavi provides digital map content and location-based solutions in China.
