Camelot Information Systems Inc. Enters Into a Merger Agreement for a "Going Private" Transaction

 Camelot Information Systems Inc. Enters Into a Merger Agreement for a "Going
                             Private" Transaction

PR Newswire

BEIJING, Sept. 18, 2013

BEIJING, Sept. 18, 2013 /PRNewswire/-- Camelot Information Systems Inc.
(NYSE: CIS) ("Camelot" or the "Company"), a leading domestic provider of
enterprise application services and financial industry information technology
services in China, today announced that it has entered into a definitive
Agreement and Plan of Merger (the "Merger Agreement") with Camelot Employee
Scheme Inc. ("Parent"), a limited liability company incorporated under the
laws of the British Virgin Islands (the "BVI") and wholly owned by Mr. Simon
Yiming Ma ("Mr. Ma"), the Company's Chairman and Chief Executive Officer, and
Camelot Employee SubMerger Scheme INC. ("Merger Sub"), a limited liability
company incorporated under the laws of the BVI and a wholly owned subsidiary
of Parent, pursuant to which Parent will acquire the Company for US$0.5125 per
ordinary share of the Company (a "Share") or US$2.05 per American Depositary
Shares, each representing four (4) Shares (an "ADS"). This represents a 36.7%
premium over the closing price of US$1.50 per ADS as quoted by the New York
Stock Exchange (the "NYSE") on March 11, 2013, the last trading day prior to
the Company's announcement on March 12, 2013 that it had received a "going
private" proposal, and a 41.3% premium over the volume-weighted average
closing price of the Company's ADSs during the 30 trading days prior to March
12, 2013. The consideration to be paid to holders of Shares and ADSs implies
an equity value for the Company of approximately US$98.2 million, on a fully
diluted basis.

Immediately following the consummation of the transactions contemplated under
the Merger Agreement, Parent will be beneficially owned by Mr. Ma, Ms. Heidi
Chou, the Company's President, Mr. Yuhui Wang, the Company's Executive Vice
President (and/or entities affiliated with or related to them) (collectively,
the "Buyer Group"), together with other 32 existing shareholders of the
Company (and/or entities affiliated with or related to them) who have elected
to cancel their rollover Shares and to subscribe for newly issued shares of
Parent (the "Rollover Shareholders").

Subject to the terms and conditions of the Merger Agreement, at the effective
time of the merger (the "Effective Time"), Merger Sub will merge with and into
the Company, with the Company continuing as the surviving corporation and a
wholly owned subsidiary of Parent (the "Merger"). At the Effective Time, each
of the Company's Shares issued and outstanding immediately prior to the
Effective Time (including Shares represented by ADSs) will be cancelled in
exchange for the right to receive US$0.5125 per Share or US$2.05 per ADS, in
each case, in cash and without interest , except for the excluded Shares (the
"Excluded Shares"), which include (i) Shares beneficially owned by the Buyer
Group or any person controlled by any of them prior to the Effective Time (the
"Founder Shares"); (ii) Shares beneficially owned by the Rollover Shareholders
(the "Rollover Shares"); and (iii) Shares (the "Dissenting Shares") owned by
holders of Shares who have validly exercised and not effectively withdrawn or
lost their appraisal rights pursuant to Section 179 of the BVI Business
Companies Act, 2004, as amended (the "BVI Companies Act") (the "Dissenting
Shareholders"). Each Excluded Share (including ADSs that represent Excluded
Shares but excluding the Dissenting Shares) issued and outstanding immediately
prior to the Effective Time will be cancelled and will cease to exist, and no
consideration will be delivered with respect thereto. Each Dissenting
Shareholder will be cancelled at the Effective Time for the right to receive
the fair value of such Shares as determined in accordance with the provisions
of the BVI Companies Act.

Parent has entered into a debt commitment letter, pursuant to which China
Development Industrial Bank has agreed to provide Parent with debt financing
in an amount of US$70 million, the proceeds of which will be used to finance
the consummation of the Merger and the other transactions contemplated by the
Merger Agreement. Parent has also entered into an equity commitment letter,
pursuant to which Zoyi Management Consulting, Ltd. has committed to cause
certain of the funds and/or entities that it manages or advises to purchase
convertible notes of Parent at or immediately prior to the Effective Time for
an aggregate cash purchase price in immediately available funds equal to US$20
million, plus an additional US$10 million at the sole option of Zoyi
Management Consulting, Ltd. The Buyer Group hasentered into a limited
guarantee in favor of the Company.

The Company's board of directors, acting upon the unanimous recommendation of
the independent committee (the "Independent Committee") formed by the board of
directors, 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 Independent Committee, which is comprised
solely of independent and disinterested directors of the Company who are
unaffiliated with any of Parent, Merger Sub, the Buyer Group or any of the
management members of the Company, negotiated the terms of the Merger
Agreement with the assistance of its financial and legal advisors.

The Merger, which is currently expected to close in early 2014, is subject to
customary closing conditions, including the approval by an affirmative vote of
shareholders representing more than fifty percent (50%) of the outstanding
Shares of the Company, present and voting in person or by proxy as a single
class at an extraordinary general meeting of the Company's shareholders which
will be convened to consider the approval of the Merger Agreement and the
Merger. As of the date of the Merger Agreement, the Rollover Shareholders have
agreed under a voting agreement to vote all in favor of the Merger Agreement
and consummation of the transactions contemplated thereby, including the
Merger. If completed, the Merger will result in the Company becoming a
privately held company and its ADSs will no longer be listed on the NYSE.

Duff & Phelps Securities, LLC and Duff & Phelps, LLC (collectively, "Duff &
Phelps") is serving as financial advisor to the Independent Committee.
Shearman & Sterling LLP is serving as United States legal advisor to the
Independent Committee and the Company. Maples and Calder is serving as BVI
legal advisor to the Independent Committee. Skadden, Arps, Slate, Meagher&
Flom LLP is serving as United States legal advisor to the Buyer Group. Locke
Lord LLP is serving as United States legal advisor to Duff & Phelps.

Additional Information about the Transaction

The Company will furnish to the Securities and Exchange Commission (the "SEC")
a report on Form 6-K regarding the proposed transactions described in this
announcement, which will include the Merger Agreement. All parties desiring
details regarding the proposed Merger are urged to review these documents,
which will be available at the SEC's website (http://www.sec.gov).

In connection with the proposed Merger, the Company will prepare and mail a
proxy statement to its shareholders. In addition, certain participants in the
proposed Merger will prepare and mail to the Company's shareholders a
Schedule13E-3 transaction statement. These documents will be filed with or
furnished to the SEC. INVESTORS AND SHAREHOLDERS ARE URGED TO READ CAREFULLY
AND IN THEIR ENTIRETY THESE MATERIALS AND OTHER MATERIALS FILED WITH OR
FURNISHED TO THE SEC WHEN THEY BECOME AVAILABLE, AS THEY WILL CONTAIN
IMPORTANT INFORMATION ABOUT THE COMPANY, THE PROPOSED MERGER AND RELATED
MATTERS. In addition to receiving the proxy statement and Schedule13E-3
transaction statement by mail, shareholders also will be able to obtain these
documents, as well as other filings containing information about the Company,
the proposed Merger and related matters, without charge, from the SEC's
website (http://www.sec.gov) or at the SEC's public reference room at 100 F
Street, NE, Room1580, Washington, D.C. 20549. In addition, these documents
can be obtained, without charge, by contacting the Company at the following
address and/or telephone number:

Camelot Information Systems Inc.

A6 North Ring 3 Road
Xicheng District
Beijing 100120
People's Republic of China
Telephone: +86-10-82019000

The Company and certain of its directors, executive officers and other members
of management and employees may, under SEC rules, be deemed to be
"participants" in the solicitation of proxies from shareholders with respect
to the Merger. Information regarding the persons or entities who may be
considered "participants" in the solicitation of proxies will be set forth in
the proxy statement and Schedule 13E-3 transaction statement relating to the
Merger when it is filed with the SEC. Information regarding certain of these
persons and their beneficial ownership of the Company's Shares as of March 31,
2013 is also set forth in the Company's Form 20-F, which was filed with the
SEC on April 29, 2013. Additional information regarding the interests of such
potential participants will be included in the proxy statement and Schedule
13E-3 transaction statement and the other relevant documents filed with the
SEC when they become available.

This announcement is neither a solicitation of proxy, an offer to purchase nor
a solicitation of an offer to sell any securities and it is not a substitute
for any proxy statement or other filings that may be made with the SEC should
the proposed merger proceed.

About Camelot Information Systems Inc.

Camelot is a leading domestic provider of enterprise application services and
financial industry information technology ("IT") services in China, focusing
on the high end of the IT value chain. The Company is the largest domestic
provider of SAP-based Enterprise Resource Planning services in China, as
measured by its 2010 revenues and the number of SAP consultants as of December
31, 2010, according to International Data Corporation ("IDC"). IDC also ranked
Camelot the number-one service provider in the banking testing market in 2010.
Camelot also operates in other areas of the Asia Pacific region, including
Taiwan and Japan. The Company provides services to a wide range of industries,
including financial services, resources and energy, manufacturing and
automobiles, technology, as well as telecommunications, media and education.

Safe Harbor

This press release contains statements that may constitute "forward-looking"
statements within the meaning of Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of 1934, as amended,
and as defined in the U.S. Private Securities Litigation Reform Act of 1995.
These forward-looking statements involve a number of risks and uncertainties
that could cause actual results, performance or achievements to be materially
different from any future results, performance or achievements expressed or
implied by these forward-looking statements. A number of factors could cause
actual results to differ materially from those contained in any
forward-looking statement, including but not limited to the following: the
Company's growth strategies, the Company's ability to attract and retain
skilled professionals, the market of IT services in China, the wages of IT
professionals, the Company's ability to serve, retain, and attract customers.
Further information regarding these and other risks is included in Camelot's
filings with the U.S. Securities and Exchange Commission, including its annual
report on Form 20-F. Camelot does not undertake any obligation to update any
forward-looking statement as a result of new information, future events or
otherwise, except as required under applicable law.

For investors and media inquiries, please contact:

                                        Investor Relations Contacts:

                                        CCG Investor Relations

                                        Mr. Crocker Coulson, President
Company Contacts:
                                        Tel: +1 (646) 213-1915
Ms. Jojo Guo, Investor Relations
Manager                                 E-mail: crocker.coulson@ccgir.com

Tel: +1 (646) 371-6533                  

E-mail: investors@camelotchina.com      Mr. John Harmon, CFA, Sr. Account
                                        Manager

                                        Tel: +86 (10) 8573 1014 (Beijing)

                                        E-mail: john.harmon@ccgir.com

SOURCE Camelot Information Systems Inc.

Website: http://www.camelotchina.com
 
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