BEIJING, Sep. 28, 2009 (Xinhua News Agency) -- China's leading Internet portal Sina Corp. (NASDAQ:SINA) (SINA.NASDAQ) announced Monday that its management including the CEO Cao Guowei will purchase about 5.6 million common stocks valued at some 180 million U.S. dollars of the company, and become the largest shareholder of Sina. It's the first MBO (management buyout) case in China's Internet industry.
The Sina management will conduct the share procurement through the New-Wave Investment Holding Co., Ltd. (New-Wave Investment). Cao and other front officials of Sina will have the de facto control of New-Wave Investment.
Sina will issue some 5.6 million additional common stocks to New-Wave Investment, which will boost the company's total equities to 59.54 million shares from 53.94 million, and New-Wave Investment will possess about 9.4 percent stake in Sina after the increase in shares.
The shares held by New-Wave Investment won't be tradable within six months, and the raised 180 million dollars will be used for possible acquisitions in future and ordinary operation of Sina.
Wang Yan, the chairman of the board of directors of Sina, said that the company is very glad to achieve the private financing with its management. The financing will further increase Sina's liquidity, enhance the company's capacity of strategic development, and shows the confidence of the management on the company's future development.
Statistics show that the cash, equivalents, and short-term investments of Sina value at 580 million dollars, and the firm's cash reserves are expected to top 760 million dollars after the stock issuance, which will further improve Sina's financial condition.
