Marbridge Daily

<- May 22, 2012 ->

Kingsoft WPS Completes MBO

Hong Kong Exchanges and Clearing Limited, 5/21/12

Chinese software developer Kingsoft (3888.HK) announced today that, together with Kingsoft Office, the company has entered into an Ordinary Share Purchase Agreement with WPS Holdings and other relevant parties, whereby Kingsoft Office will issue and sell to WPS Holdings an aggregate of 200,000,000 Kingsoft Office Shares at a price of USD 0.03 per share for an aggregate consideration of USD 6 mln. Concurrently, Kingsoft entered into the Loan Agreement with WPS Holdings, whereby the company will provide a loan in the amount of USD 4.5 mln to WPS Holdings at an interest rate equivalent to HIBOR plus 1.3% per annum for the purpose of acquiring Kingsoft Office Shares.

WPS Holdings is a company 100% owned by the Founding Employees. As WPS Holdings is an associate of Ge Ke, a director of certain subsidiaries of the Group, WPS Holdings is a connected person of the company pursuant to Chapter 14A of the Listing Rules. As a result, transactions contemplated under the Ordinary Share Purchase Agreement and Loan Agreement between WPS Holdings and the company constitute connected transactions.

As the relevant applicable percentage ratios (as defined in the Listing Rules) in respect of the Ordinary Share Purchase Agreement and Loan Agreement are less than 5%, the transactions contemplated under the Ordinary Share Purchase Agreement and Loan Agreement constitute connected transactions of the company pursuant 14A of the Listing Rules and are subject to reporting and announcement requirements and exempted from independent shareholders' approval requirement.

For more details on the Share Purchase Agreement, please click here. For more background on this topic, please see "Rumor: Kingsoft to Spin Off Office Software Business," MD 5/24/11 issue.

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