Shanghai Tongda Venture Capital has reported that it will raise over CNY 2.40 billion (USD 391 million) through private placement to finance the acquisition of Beijing Super TV, a division of China Digital TV, for CNY 3.20 billion (USD 522 million).
The company will issue over 231.88 million new shares issued at CNY 10.35 (USD 1.68) per share. Under terms of the agreement Tongda Venture is paying CNY 2.40 billion in cash, which will be funded from the private placement and over CNY 800 million (USD 130 million)-worth of shares.
China Digital TV which operates Beijing Super TV and Shanghai Tongda Venture Capital had entered into a framework agreement on June 13, 2014. Through China Digital’s Golden Benefit arm, it will have over 17.5% stake in Tongda Venture and its 77.29 million shares will be subject to a 36 month lock-up
As per the terms, Cinda Investment which is the largest shareholder in Tongda Venture can subscribe for up to 8% in both Beijing Cyber Cloud and Beijing Joysee Technology, China Digital TV’s subsidiaries which are valued at CNY 350 million (USD 57 million) and CNY 240 million (USD 39 million), respectively.
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