E-House Submits Non-Binding Proposal To Acquire All Outstanding Shares Of CRIC
SHANGHAI, Oct. 28, 2011 /PRNewswire-Asia-FirstCall/ -- E-House ( China) Holdings Limited ("E-House" or the "Company") (NYSE: EJ), a leading real estate services company in China, today announced it has submitted a non-binding proposal to the board of directors of China Real Estate Information Corporation ("CRIC") (NASDAQ: CRIC) to acquire through a merger all the outstanding shares of CRIC that are not owned by E-House. E-House has proposed a fixed consideration consisting of $1.60 cash and 0.6 E-House shares for each CRIC share. E-House is the majority shareholder of CRIC owning 54.1% of CRIC's total outstanding shares. Assuming the successful consummation of the transaction, CRIC would become a wholly-owned subsidiary of E-House.
"The proposed merger between E-House and CRIC is a key strategic step for both companies," said Mr. Xin Zhou, E-House's executive chairman. "In today's real estate industry in China, developers increasingly demand more than traditional sales agency service. Instead, they favor a truly comprehensive and integrated one-stop solution, including offline agency and consulting, online advertising and promotion, and an e-commerce transaction platform. E-House has already developed a comprehensive online-to-offline ("O2O") service platform. In order to successfully operate the platform and provide seamless service to our clients, we need to deepen the integration of our management and professional team, coordinate our marketing efforts across all our business segments, and improve our management efficiency. Merging E-House and CRIC would enable us to provide clients with a comprehensive suite of high-quality services, as we continue to innovate and lead China's real estate service industry."
Mr. Li-Lan Cheng, E-House's chief financial officer, added, "We believe the proposed merger would be beneficial to the shareholders of both companies. It would provide attractive returns to CRIC shareholders and improve the liquidity of CRIC shareholders' investments. For E-House, the transaction utilizes our cash balance and is also earnings-accretive for E-House shareholders. Furthermore, merging the two companies would improve management efficiency."
Assuming the successful consummation of the proposed merger, SINA Corporation (NASDAQ: SINA) would become E-House's largest shareholder with approximately 25% of E-House's total outstanding shares. Mr. Xin Zhou and E-House's senior management team would own approximately 20% of E-House's total outstanding shares.To the knowledge of E-House, no decisions have been made by CRIC's board of directors with respect to its response to E-House's proposal. There can be no assurance that any agreement will be executed or that this or any other transaction will receive necessary approvals or be consummated.
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