Lakala to Backdoor List on Shanghai Exchange via 'Tibet Tourism' Shell
Tencent Tech, 2/05/16
Tibet Tourism (600749.SH) has announced a plan to wholly-acquire Beijing-based e-payment service provider Lakala through issuance of stock and cash payments to the 46 individuals and companies who currently hold equity. Tibet Tourism will pay RMB 2.5 bln in cash and issue RMB 8.5 bln worth of stock at RMB 18.65 per share to cover the RMB 11 bln valuation of Lakala. At the same time, Tibet Tourism plans to raise RMB 5.5 bln in matching funds to cover the RMB 2.50 bln cash portion of the acquisition, RMB 2.44 bln for use in investments in Lakala projects, and RMB 503.5 mln for repayment of Tibet Tourism's bank loans.
After the transaction is completed, Lakala founder and chairman Sun Taoran will directly hold a 24.21% stake in Tibet Tourism and be the controlling stakeholder. Another investor, Sun Haoran (not to be confused with Sun Taoran), will directly hold a 3.39% stake, and Beijing-based brand management solutions firm BlueFocus Communication Group (300058.SZ) will hold 0.54%. Tibet Tourism's equity structure will reflect the following changes:
| Tibet Tourism Shareholder | Stake Before Transactions | Stake After Transactions |
|---|---|---|
| Guofeng Group | 16.10% | 3.24% |
| Tibet Tilv | 7.54% | 1.52% |
| Other Shareholders | 76.36% | 15.37% |
| Sun Taoran (Lakala Chairman) | 24.21% | |
| Legend Holdings | 23.12% | |
| Sun Haoran | 3.39% | |
| Heming Yongchuang | 1.75% | |
| Chen Jiangtao | 1.57% | |
| Taibao Nanshan | 1.46% | |
| Zhong Yingqiao | 1.15% | |
| Dai Qijun | 2.03% | |
| Kunlun Xinzheng | 0.91% | |
| Dadi Caixian | 0.90% | |
| Taipin Guofa | 0.80% | |
| Others | 18.58% | |
| Total | 100.00% | 100.00% |
In 2014, Lakala had RMB 1.97 bln in total assets, RMB 910 mln in operating revenue and a net loss of RMB 195 mln. Lakala's total assets grew to RMB 4.36 bln in 2015 with RMB 1.59 bln in operating revenue and a profit of RMB 126 mln.
Lakala promises that annual net profits in 2016, 2017, and 2018 will be no less than RMB 450 mln, RMB 860 mln, and RMB 1.45 bln.
Editor's Note: Sun Taoran is not only the founder, chairman, and president of Lakala, but is also a current board member and actual controller of BlueFocus Communication Group. Lei Jun, CEO of Beijing-based Android device maker Xiaomi, held a 1.26% stake in Lakala as of November, 2015.
Lakala announced that the acquisition is not technically a backdoor listing because the total assets issued to Lakala's stockholders only account for 93.79% of Tibet Tourism's total assets by the end of 2015, instead of the required 100%.
Keywords: Tibet Tourism 600749.SH M&A Internet valuation Lakala e-payment Shanghai Stock Exchange backdoor listing Sun Taoran Sun Haoran Lei Jun
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