China’s AutoNavi agrees to be acquired by Alibaba

According to a statement, Alibaba will pay $21 per share in cash for the 72% of AutoNavi it does not already own - the same terms it originally offered in February. This represents a 27% premium to AutoNavi's closing price on February 7, the last trading day before it formally announced the deal.

The transaction is expected to close in the third quarter this year.

In May, Alibaba agreed to buy a 28% stake in AutoNavi for $294 million - one of a string of acquisitions by Chinese internet companies as they seek to diversify business lines.

"We are excited to work with the talented team at AutoNavi to further integrate mobile commerce into the lives of our consumers," said Jonathan Lu, Alibaba's CEO. "As a result of this transaction, we believe AutoNavi will continue to be a strong player in an increasingly competitive map applications and local services market."

Users of AutoNavi's free mobile map application had grown to 171 million as of September 2013, compared to 85 million in September 2012. The premium navigation application was downloaded and pre-loaded on to approximately 83 million smart phones in the third quarter of 2013.

According to AVCJ Research, AutoNavi received $40 million in VC funding in 2006 from a group of investors. The consortium included Walden International, Sequoia Capital, Legend Capital, ChinaValue Capital Advisors, Harbinger Venture Management, Indus Capital Advisors, Inventec Appliances, KPCB and MTI Capital. The company went public in 2010, raising $107 million.

As of April 2013, none of these investors was among AutoNavi's principal shareholders.

Lazard serves as financial advisor to AutoNavi, while Deutsche Bank advised Alibaba on this transaction.

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• Topics
• Greater China
• Buyouts
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• Alibaba Group
• buyout
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