CITIC Capital consortium completes $887m AsiaInfo take-private
CITIC Capital Partners has completed the privatization of US-listed Chinese telecom software provider AsiaInfo-Linkage in a deal that values the company at $887 million. CITIC Private Equity and China Broadband Capital were also part of the buyer consortium.
It is the second-largest private equity-backed management buyout of a Chinese company after Focus Media, although the acquisition of Giant Interactive Group - supported by Baring Private Equity Asia and potentially worth $2.8 billion - is still pending. A total of 11 take-private deals for US-listed Chinese companies have now been completed since August 2011 and about 14 more are in process.
According to a regulatory filing, AsiaInfo shareholders voted in favor of the consortium's $12 per share bid in late December and the formalities for delisting from NASDAQ began this week.
In addition to CITIC Capital, CITIC PE and China Broadband Capital, AlpInvest Partners, Qatar Investment Authority, Temasek Holdings and InnoValue Capital. These investors are providing $415 million in equity, while existing shareholders, including Asiainfo co-founder Edward Tian, are rolling over their holdings. Tian is also CEO of China Broadband Capital.
A further $330 million in debt financing is being provided by Nomura International, Bank of Taiwan, Cathay United Bank, ICBC International Capital and Maybank.
CITIC Capital submitted its offer in January 2012 and it was accepted by the AsiaInfo board in May 2013. There were reports of interest from other prospective private equity buyers in the interim.
AsiaInfo reported a net income of $29.9 million in 2012, down from $72.9 million the previous year as cost of revenues and operating expenses increased significantly. Revenue came to $547.9 million compared to $480.9 million in 2011. Nearly all the company's takings come from the sale of business and operation support systems to China's three state-owned telecom providers.
"We are very excited about the completion of the AsiaInfo investment," said Yichen Zhang, CEO of CITIC Capital. "The company is a leading player in an industry with strong growth drivers. We look forward to leveraging our experience and relationships to help AsiaInfo continue to realize its long-term potential."
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