Giant Interactive Gets Offer From Chairman To Be Taken Private For $11.75/ADS

(RTTNews) - Giant Interactive Group Inc. (GA), China-based online game developers and operators, announced Monday that it has received a preliminary non-binding proposal from a Consortium led by its Chairman, Yuzhu Shi to take the company private for US$11.75 in cash per ordinary share or ADS.

The company's board of directors received a takeover proposal letter dated November 25, 2013, from Yuzhu Shi and his affiliated entities and Baring Private Equity Asia V Holding (12) Limited, an entity controlled by The Baring Asia Private Equity Fund V, L.P.

As per the proposal letter, the consideration payable for each American Depositary Share of the Company or (ADS, each representing one ordinary share of the Company) will be $11.75 in cash, or $11.75 in cash per ordinary share (in each case other than those ADSs or ordinary shares held by the Consortium Members that may be rolled over in connection with the Acquisition pursuant to the Consortium Agreement.).

The consortium's letter said that the proposal represents a premium of 21.0% to the Company's closing price on November 22, 2013.

As of November 25, 2013, the Consortium members beneficially owned, in the aggregate, approximately 47.2% of the Company's share capital on a fully enlarged basis.

The consortium's proposal letter also stated that its proposal constitutes only a preliminary indication of its interest and is subject to negotiation and execution of definitive agreements relating to the proposed transaction.

The company noted that its board, other than Yuzhu Shi, is reviewing and evaluating the Consortium's proposal. It expects that the Board will adopt various procedures and protocols designed to fully and fairly evaluate the proposal as well as safeguard the interest of the Company's shareholders that are unaffiliated with the Consortium, including forming a special committee consisting of independent directors that are unaffiliated with members of the Consortium and not management members of the Company to evaluate and, if appropriate, negotiate the proposal and to consider other strategic options available to the Company.

The company cautioned its shareholders and others considering trading in its securities that the Board has just received the proposal letter and has not made any decisions with respect to the company's response to the proposal.

The consortium plans to finance the Acquisition with a combination of debt and equity capital. Equity financing would be provided from the Consortium Members and any additional members it accepts into the Consortium.