Chinese consortium agrees scaled back Opera deal
A PE-backed Chinese consortium has agreed a $600 million acquisition of the web browser business of Norway’s Opera Software after a full takeover bid worth $1.2 billion failed to attain government approval.
The consortium includes Golden Brick Capital Private Equity Fund I, which is managed by Hong Kong-based private equity firm Golden Brick Capital - one of the participants in the take-private of Chinese internet security software provider Qihoo 360 Technology. According to a statement, the consortium will acquire a block of assets within Opera's consumer segment, including mobile and desktop browsers, a technology licensing business and performance and privacy apps.
The deal will also include a 29% stake in Horizon Innovation Software, a Chinese joint venture between Opera and Telling Telecommunication. Opera previously indicated interest in divesting its TV assets, but clarified that the TV, games and Mediaworks units of its consumer business would not be part of the transaction.
Opera's CEO, Lars Boilesen, will continue to lead the consumer businesses involved in the deal until the end of calendar 2016. The transaction is expected to close during the third quarter of 2016.
The acquisition represents an alternative option agreed by the interested parties after it became clear earlier this year that government approvals for the proposed takeover of Opera would not be forthcoming. In February, the consortium offered NOK71 ($8.40) per share for the company, which at the time had been trading in a range of NOK40-50 per share. The stock fell as much as 17% after the July 15 deadline for regulatory approval of the takeover. It was last trading at NOK54.
Opera is the fourth-largest browser provider globally, after Google's Chrome, Alibaba Group-controlled UCWeb, and Apple's Safari. Its products are used by more than 350 million internet users. The company's consumer businesses that will be purchased in the alternative acquisition were estimated to generate $149 million during 2015, down about 17% from the prior year. Adjusted EBITDA among the same units fell about 28% during 2015 to $334 million.
Golden Brick focuses on investments in technology, media and telecom, energy and natural resources, and has about $3 billion in assets under management. Golden Brick Silk Road - through Golden Brick Capital Private Equity Fund I - is involved in the Qihoo privatization.
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