Qihoo 360 to be taken private in $9.3 bln deal

23 Dec 2015 | Author: | No comments yet »

Against the Odds, Qihoo Gets Its Buyout.

Qihoo 360 has finally got its $9.3 billion buyout, against the odds. Deals of the Day is your one-stop-shop for the morning’s biggest news from the finance beat, including M&A, IPOs, banks, hedge funds and private equity.A consortium of buyers led by Qihoo’s chairman Zhou Hongyi will pay $77 per American Depositary Share, a price tag that matches the earlier offer and represents a 17% premium to where shares were trading before the June bid.HONG KONG — The Qihoo 360 Technology Company, a Chinese Internet security firm, said on Friday that it had agreed to be taken private and bought by a consortium of investors for about $9.3 billion.

The deal represents a premium of 16.6 percent to the closing price of the company’s American depositary shares on June 16, the day before it proposed going private. The Avon Products Inc. transaction with Cerberus Capital Management LP, which would inject $435 million into Avon and carve out the North American business into a separate company with another $170 million investment, buys Chief Executive Sheri McCoy more time to figure out a viable plan for Avon’s remaining operations. [WSJ] Qihoo 360 goes private. Qihoo, which provides products and services to protect computers and mobile devices from malware and malicious websites, was the biggest of a wave of buyout offers made earlier this year while Chinese stocks were soaring. Even after securing $3.4 billion in debt to fund the deal, the investor group led by its chief executive, Zhou Hongyi, still had to raise $5.9 billion in new equity. Dell Inc. shed light on how it will close an estimated $10 billion financing gap in its proposed acquisition of storage vendor EMC Corp. on Thursday by disclosing plans for an initial public offering by its SecureWorks security division. [WSJ] No-lose bet.

The investors include the Citic Guoan Group, Golden Brick Silk Road Capital, Sequoia Capital China, Taikang Life Insurance, the Ping An Insurance Group, Sunshine Insurance, New China Capital, Huatai Ruilian, and Huasheng Capital. Sourcing billions in funds to take foreign-listed companies private, with the idea of relisting them on China’s own stock market, seemed much more straightforward. The consortium plans to pay for the transaction with cash contributions from investors, a committed term loan of up to $3 billion and a bridge loan of $400 million. For the two dozen or so United States-listed companies that have announced take-private plans, repeating Qihoo’s financing feat may not be as simple.

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