China’s Sungy Mobile buys VC-backed app store Getjar

The transaction is worth an initial $5.3 million in cash, although Sungy may issue up to 1.44 million ordinary shares as earn-out payments to GetJar's owners by early 2016, conditional on certain performance targets being achieved. This might explain the earlier reported purchase price of over $50 million.

Sungy's platform product, GO Launcher Ex, manages apps, widgets and functions on Android smart phones, serving as users' first entry point to their phones. The company, which launched in 2010, also operates a mobile internet portal and mobile reading services.

Getjar was set up as an app store in 2004 and later pivoted into an Android app recommendation service. The company is understood to have raised $42 million in VC funding.

"We are pleased to expand our global footprint with our first international acquisition," Yuqiang Deng, Sungy's CEO, said in a statement. "Our acquisition of GetJar provides our platform with state-of-the-art mobile data analytics capabilities that will support our mobile advertising research and development initiatives, and accelerate our product development process."

Sungy raised $78.5 million through its IPO in November 2013, having initially targeted $80 million. The stock jumped 19% on its market debut and is currently trading around the $23 mark, more than double the IPO price.

The offering represented a liquidity event for VC backers IDG Capital Partners, JAFCO, WI Harper and China Broadband Capital (CBC). Their post-IPO holdings stood at 20.8%, 7.0%, 7.1% and 10.6%, respectively.

Revenues, generated from advertising, paid apps, in-app purchases and sales of literary content, reached RMB185.2 million ($30.2 million) in 2012, up 91.7% year-on-year. The company also turned profitable in 2012, with net income coming in at RMB15.2 million. It achieved revenues of RMB139.3 million in the first half of 2013, with net income of RMB5.5 million.

LightInTheBox, another VC-backed Chinese company that went public in the US last year, has also been on the acquisition trail in the US, picking up social e-commerce site Ador for an undisclosed sum.

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