NEW YORK (TheStreet) -- China Hydroelectric Corp. (CHC) was rising 22.7% to $3.35 after the company announced it has entered into a definitive agreement and plan of merger with CPT Wyndham Holdings Ltd. and CPT Wyndham Sub Ltd., both of which are affiliates of NewQuest Capital Partners and the funds it manages.
Wyndham will purchase China Hydroelectric for $1.17 per ordinary share or $3.51 per American Depositary Share. The company announced on Sept. 4, 2013 it had received a non-binding proposal letter from CPI Ballpark Investments Ltd, an affiliate of the NewQuest Funds, to purchase all of the Company's outstanding ordinary shares that they did not already own. The $3.51 price represents a 57.4% premium over the closing price of $2.23 ADS on Sept. 3 and a 60.5% premium over the volume-weighted average trading price of the ADSs during the 30-day trading period up to and including Sept. 3.
As of 3:17 p.m. on Monday, China Hydroelectric had a volume of more than 1 million, far above its average volume of 67,143 and nearly hit its one-year high of $3.37.
TheStreet Ratings team rates China Hydroelectric ADRs as a "sell" with a ratings score of D+. TheStreet Ratings Team has this to say about their recommendation:
"We rate CHINA HYDROELECTRIC CORP-ADR (CHC) a SELL. This is driven by some concerns, which we believe should have a greater impact than any strengths, and could make it more difficult for investors to achieve positive results compared to most of the stocks we cover. The company's weaknesses can be seen in multiple areas, such as its unimpressive growth in net income and weak operating cash flow."