IDG-Accel China Capital II to acquire mobile tech firm MEMSIC

According to a statement, the purchase price of $4.22 apiece for the remaining outstanding stocks represents a premium of 143% over MEMSIC's November 20 close at $1.74 per share, the last trading day before IDG-Accel first made its bid to acquire MEMSIC. It is higher than IDG-Accel's initial offer of $4 per share. The transaction is expected to close during the third quarter this year, pending shareholder approval.

IDG-Accel and its affiliates currently own 19.5% of MEMSIC. Quan Zhou, managing partner at IDG, sits on the company's board however he is not participating in board discussions on the transaction.

The investors plan to finance the acquisition through equity capital in the form of cash and rollover equity in the target company.

This investment will be the lastest in a series take-private transactions involving US- listed Chinese companies. Increasingly the chairmen and owners of these companies have been forced to consider privatization after a spate of accounting scandals over the past couple of years have led to much lower valuations among small to mid-cap US-listed Chinese firms. Private equity firms have often been able to participate as execution partners.

Prior to the Memsic offer - which is unusual in that it isn't a management buyout - 45 transactions have been announced since 2010, 16 of which involved private equity.

IDG Capital Partners is a joint China investment venture between media giant International Data Group (IDG) and venture capital firm Accel Partners. Set up at 1992, IDG Capital has invested in 200 companies, such as Baidu, Sohu, Tencent, Ctrip and Soufun, and it have exited from over 60 investments trough M&A or IPO in the US, Hong Kong and China A-share market.

 

 

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• Topics
• Greater China
• Technology
• PIPEs
• TMT
• IDG Capital Partners
• Accel Partners