Spreadtrum accepts sweetened Tsinghua Unigroup buyout offer
Spreadtrum Communications, a Chinese mobile chip manufacturer backed by New Enterprise Associates (NEA), is to be acquired by Tsinghua Unigroup after the buyer increased its offer. The merger - which will now go to a shareholder vote having received board approval - values Spreadtrum at approximately $1.78 billion.
Unigroup is a unit of Tsinghua Holding, an investment entity controlled by Beijing-based Tsinghua University. According to a release, the unit will acquire all outstanding ordinary shares of Spreadtrum for $31 per American Depositary Share (ADS), representing a 17.2% premium on the previous close.
Unigroup initially offered to pay $28.50 apiece in cash for all outstanding shares last month.
As of year-end 2012, NEA owned 10.4% of the company, having initially participated in the $19.8 million Series B round in 2002. Spreadtrum went public on NASDAQ in 2007, raising $124.6 million.
Silver Lake bought a 13% stake for $40 million in 2010 but exited the following year. In 2011, Spreadtrum came under fire from short-seller research firm Muddy Waters over alleged accounting discrepancies. The company denied any wrongdoing.
Founded in 2001, Spreadtrum develops mobile chipset platforms for smartphones, feature phones and other consumer electronics products, supporting 2G, 3G and 4G wireless communications standards. The company has annual revenues of around $720 million as of last year.
Tsinghua Holdings is a state-owned company responsible for managing the majority of Tsinghua University's commercial assets. As of year-end 2012, Tsinghua Holdings had approximately RMB70.4 billion ($11.5 billion) in assets and a net income of RMB1.45 billion. Unigroup focuses on high-tech, biotech, real estate and urban infrastructure investments.
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