Rumor: Netease, MSN China Still in M&A Talks
Southern Metropolitan News, 8/06/10
A person involved in talks between MSN China and Chinese internet company Netease (Nasdaq: NTES) revealed that talks between the companies have not ended, as had previously been reported; rather, the companies have entered the "back-and-forth" stage.
An informed source in the investment industry said that in addition to issues of the acquisition price, Microsoft would require as a condition of the acquisition that whatever company takes over MSN China be prepared to make continued investments in MSN China every year.
The investor source said that the "leak" that Hong Kong-based television entertainment company ChinaVision Media Group (1060.HK) had set aside USD 100 mln to invest in an internet company might have been an attempt by MSN China stockholders to create psychological pressure on Netease. An informed source said that the ultimate decision on to whom to sell MSN China equity would be made by Microsoft headquarters - but that the conditions and price of the 50% stake in MSN China would be made on the basis of the interests of MSN China's Shanghai investors. Therefore, the source said, one of MSN China's Shanghai investors could have been behind the ChinaVision announcement, which also served to increase the visibility of ChinaVision.
Editor's Note: For more background on this topic, please see "Rumor: ChinaVision May Take Stake in MSN China" MD 7/26/10 and "ChinaVision to Acquire Unnamed Internet Firm" MD 7/30/10 issues.
Keywords: instant messaging Netease Internet MSN China M&A NTES ChinaVision 1060.HK
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