What happened
Shares of NQ Mobile (NYSE: NQ) jumped on Thursday, closing out the day with a 12% gain, after the company provided an update on its FL Mobile divestment and sale of Showself's life social media video business. The company received a hefty cash infusion as part of the ongoing process.
So what
NQ Mobile received an additional 800 million yuan ($120.5 million), which is in addition to the 150 million yuan ($22.6 million) that it had received back in March when it signed the agreement. Adding up those two figures, NQ Mobile has now received a total of 950 million yuan ($143 million) so far.
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The company has been working on divesting these assets for quite some time.
Now what
NQ Mobile says that the Tongfang Investment Fund remains committed to completing the divestments, which will include acquiring a 63% equity stake in FL Mobile, which is the interest that NQ Mobile currently holds, for a total cash consideration of 2.5 billion yuan ($379.5 million), based on FL Mobile having a total valuation of 4 billion yuan ($602.3 million). The fund will also acquire NQ Mobile's 65% stake in Showself for a total of 800 million yuan ($120.5 million), based on Showself having a total valuation of 1.23 billion yuan ($185.2 million).
NQ says it continues to work with Tongfang to complete the transaction as soon as possible, and all parties are confident they can complete the deals quickly.
