Shanda Interactive Entertainment Ltd. and an affiliate of Primavera Capital Ltd., which together own 76 percent of Shanda Games, sent a nonbinding proposal to buy the company for $3.45 an ordinary share or $6.90 per American depositary share, Shanda Games said today in a statement. The offer represents a 22 percent premium to the American shares’ closing price on Jan. 24.
The board is reviewing the proposal and will form a special committee of independent directors to evaluate and negotiate the bid as well as consider “other strategic options.” The proposed buyout would be financed with equity capital and third-party debt, Shanghai-based Shanda Games said.
“The board has just received the proposal letter and has not made any decision,” Shanda Games said in the statement. “There can be no assurance that any definitive offer will be made by the consortium or any other person.”
Shanda Games’ American depositary shares were halted in early trading before the announcement. They rose 4.6 percent to $5.65 on Jan. 24, and have gained 23 percent so far this year.
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