Yongye to Be Taken Private in $339 Million Deal

Chinese crop nutrient manufacturer Yongye (NASDAQ: YONG  ) has entered into a buyout agreement with British Virgin Islands holding company Full Alliance International Limited, it announced today. The company has been in talks to go private since October 2012 and the offered price has come up $0.09 per share since then.

Under the terms of the deal, Yongye investors will receive $6.69 per share of common stock, a 39.7% increase from the company's closing price on Oct. 12, 2012, the last trading day prior to the Company's announcement of its receipt of a "going-private" proposal. The accepted proposal is a 1.4% increase from the initial privatization proposal price of $6.60 per share.

Yongye currently has approximately 50.69 million shares outstanding, which, at $6.69 a share, prices the deal at approximately $339.1 million. The company's chairman, CEO, and president, Zishen Wu, will provide $12 million in cash equity financing, while Lead Rich International Limited will provide an additional $15 million, according to the company's announcement.

The company's board approved the transaction, which is targeted to close before the end of fiscal 2014's first quarter. It still needs approval from at least a majority of those holding its outstanding shares.

Since the beginning of 2013, Yongye has seen its stock price rise from $5.83 per share to $6.03 at market close Sept. 18, peaking at $6.24 on Aug. 18. The company's revenue has increased 822% since 2008, moving from $48 million to $443 million.

-- Material from The Associated Press was used in this report.

 

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  • Report this Comment On September 26, 2013, at 11:01 AM, zanemorris wrote:

    This seems like a bad deal for stock holders. Growth rate and cash on hand should drive at least a 50% greater valuation. And it looks like the CEO is in on it.

  • Report this Comment On September 26, 2013, at 3:41 PM, StockgeniusII wrote:

    Talking about an inside job at take it private this is it! No fiduciary interest at all for the shareholders by the BOD either. Kind of like a bad business episode on how not to run a business that aired on CNBC! LOL!

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