ChinaNet Announces 100% Acquisition of SouYi

ChinaNet IR, 9/17/12

Chinese online and TV advertising firm ChinaNet Online Holdings (Nasdaq: CNET) today announced that it will purchase the remaining 49% equity interest it does not already own in SouYi Lian Mei Network Technology (SouYi) for approximately USD 6.5 mln in cash.

Founded in 2007, SouYi provides online advertising and marketing services to small startup businesses. SouYi generated approximately USD 6.8 mln in revenue and approximately USD 2.2 mln in profit in 2011 and is estimated to generate approximately USD 7.8 mln in revenue and approximately USD 2.4 mln in profit in 2012. ChinaNet will integrate SouYi into ChinaNet's advertising and marketing platform and join 28.com and Liansuo.com to serve the full range of small business clients over the next six months.

The company will fund the acquisition through cash on hand and operating cash flows. ChinaNet expects the transaction to close by the end of the fourth quarter of 2012. Upon closing, SouYi will become a wholly-owned subsidiary of the company.

Keywords: SouYi Liansuo.com 28.com TV advertising Internet online advertising CNET ChinaNet television M&A online franchising

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