Shanda Games Gets Non-binding Going Private Proposal At $6.90 Per ADS

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(RTTNews.com) - Shanda Games Limited ( GAME ), online game developer, operator and publisher in China, announced that its Board has received a preliminary non-binding proposal letter dated January 27th, 2014 from a Consortium comprising Shanda Interactive Entertainment Limited, the controlling shareholder of the Company, and an affiliate of Primavera Capital Limited.

The Consortium proposed to acquire the Company in a "going private" transaction for US$3.45 per class A or class B ordinary share, or US$6.90 per American depositary share. The each American depositary share represents two class A ordinary shares. Based on the offer price, the Proposal values the Company at about US$1.9 billion in fully enlarged equity value.

According to the Proposal, the offer price represents a premium of 21.3% to the Company's volume-weighted average price of its ADSs on January 24, 2014 and a premium of 44.4% to the volume-weighted average price of its ADSs during the last 30 trading days.

As of January 27, 2014, the Consortium members beneficially owned, in the aggregate, approximately 76.2% of the Company's outstanding shares.

The Consortium's proposal letter stated that its proposal constitutes only a preliminary indication of its interest and is subject to negotiation and execution of definitive agreements relating to the proposed transaction.

Shanda Games said that its board is reviewing and evaluating the Consortium's Proposal, and the company expects that the Board will form a special committee consisting of independent directors to evaluate and, if appropriate, negotiate the Proposal and to consider other strategic options available to the Company.

The Company cautioned its shareholders and others considering trading its securities that the Board has just received the proposal letter and has not made any decision with respect to the Company's response to the Proposal.

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