Alibaba offers to buy AutoNavi in $1.58B dealFebruary 10, 2014 @ 6:02 am
NEW YORK (AP) - Alibaba Group Holding Ltd. is offering to take Chinese digital mapping and navigation company AutoNavi private in a deal that values the entire business at approximately $1.58 billion.
AutoNavi's stock surged more than 27 percent in Monday premarket trading. The company said that it plans to form a committee of independent directors to consider the proposal.
Alibaba said in a regulatory filing that it will pay $21 per American depository share, or $5.25 per ordinary share. Each ADS represents four ordinary shares.
The filing said that Alibaba's proposal assumes about 300.4 million outstanding ordinary shares of AutoNavi Holdings Ltd.
In its proposal letter sent to AutoNavi on Monday, Alibaba said that it believes its offer gives AutoNavi's shareholders the chance to "realize superior value that is otherwise difficult for AutoNavi to achieve as a stand-alone company." Alibaba said that AutoNavi now has competitors that are bigger and well capitalized.
China-based Alibaba already owns approximately 28 percent of AutoNavi's outstanding stock. The company said in its letter that it is only interested in pursuing an acquisition and does not plan to sell its stake in AutoNavi to a third party.
Alibaba _ which Yahoo Inc. has a 24 percent stake in _ said that it plans to pay for the deal with available cash. Its offer isn't subject to a financing condition.
Shares of AutoNavi climbed $4.60, or 27.8 percent, to $21.14 in premarket trading about 45 minutes before the market open.
(Copyright 2014 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.)
This Week in Traffic
You've survived another week of some of the nation's worst traffic - see the photos
It's the first time Washington gun owners could lose their rights without a felony conviction
13 things to know about the Sounders, and their fans, as they kick off the season Saturday
Please login below with your Facebook, Twitter, Google+ or Disqus account. Existing MyNorthwest account holders will need to create a new Disqus account or use one of the social logins provided below. Thank you.