BlueCity Holdings Limited (“BlueCity” or the “Company”) (NASDAQ:
BLCT), a leading online LGBTQ platform, today announced that it has
entered into an Agreement and Plan of Merger (the “Merger
Agreement”) with Multelements Limited (“Parent”), Diversefuture
Limited, a wholly-owned Subsidiary of Parent (the “Merger Sub”),
pursuant to which the Company will be acquired by a buyer group in
an all-cash transaction (the “Merger”) implying an equity value of
the Company of approximately US$60 million for all of the Company’s
outstanding ordinary shares (each, a “Share”).
Pursuant to the Merger Agreement, at the effective time of the
Merger (the “Effective Time”), each Share issued and outstanding
immediately prior to the Effective Time will be cancelled and cease
to exist in exchange for the right to receive US$3.20 in cash
without interest (the “Per Share Merger Consideration”), and each
outstanding American depositary share of the Company (each, an
“ADS,” each two of which representing one Class A ordinary shares
of the Company (the “Class A Ordinary Shares”)) will be cancelled
in exchange for the right to receive US$1.60 in cash without
interest (the “Per ADS Merger Consideration”), except for (a)
certain Shares (including Shares represented by ADSs) beneficially
owned by Mr. Baoli Ma, chairman of the board of directors of the
Company (the “Board”) and chief executive officer, Aviator D, L.P.
and Rainbow Rain Limited (collectively, the “CDH Entities”), which
will be rolled over in the transaction, (b) any other Shares
(including Class A Ordinary Shares represented by ADSs) held by
Parent, Merger Sub, the Company or any of their respective
subsidiaries, (c) Shares (including Class A Ordinary Shares
represented by ADSs) held by the ADS depositary and reserved for
issuance, settlement and allocation upon exercise or vesting of
Company’s options, and (d) Shares held by shareholders who have
validly exercised and not effectively withdrawn or lost their
rights to dissent from the Merger, or dissenter rights, in
accordance with Section 238 of the Companies Act (As Revised) of
the Cayman Islands (the “Companies Act”), which will be cancelled
and cease to exist at the Effective Time in exchange for the right
to receive only the payment of fair value of those dissenting
shares held by them determined in accordance with the provisions of
Section 238 of the Companies Act.
The Per ADS Merger Consideration represents a premium of 16.8%
to the closing price of the Company’s ADSs on April 14, 2022, the
last trading day prior to the Company’s announcement of its receipt
of the revised “going-private” proposal dated April 18, 2022, and a
premium of 19.21% to the volume-weighted average price of the ADSs
during the 20 trading days prior to its receipt of the revised
“going-private” proposal letter dated April 18, 2022.
The buyer group (the “Buyer Group”) comprises Mr. Baoli Ma,
Metaclass Management ELP and the CDH Entities. The Buyer Group
intends to fund the Merger with a combination of rollover equity
and cash, and has delivered a copy of executed equity commitment
letter to the Company.
The Board, acting upon the unanimous recommendation of a
committee of independent directors established by the Board (the
“Special Committee”), approved the Merger Agreement and the Merger
and resolved to recommend that the Company’s shareholders vote to
authorize and approve the Merger Agreement and the Merger. The
Special Committee negotiated the terms of the Merger Agreement with
the assistance of its financial and legal advisors.
The Merger is currently expected to close in the second half of
2022 and is subject to customary closing conditions including the
approval of the Merger Agreement by an affirmative vote of holders
of Shares representing at least two-thirds of the voting power of
the Shares entitled to vote at a meeting of the Company’s
shareholders. Shareholders affiliated with Mr. Baoli Ma and CDH
entities have each agreed to vote all of the Shares and ADSs they
beneficially own, which represent approximately 70% of the voting
rights attached to the outstanding Shares as of the date of the
Merger Agreement, in favor of the authorization and approval of the
Merger Agreement and the Merger. If completed, the Merger will
result in the Company becoming a privately held company, and its
ADSs will no longer be listed on the Nasdaq Global Market.
The Company will prepare and file with the U.S. Securities and
Exchange Commission a Schedule 13E-3 transaction statement, which
will include a proxy statement of the Company. The Schedule 13E-3
will include a description of the Merger Agreement and contain
other important information about the Merger, the Company and the
other participants in the Merger.
Kroll, LLC, operating through its Duff & Phelps Opinions
Practice is serving as financial advisor to the Special Committee.
Skadden, Arps, Slate, Meagher & Flom LLP is serving as U.S.
legal counsel to the Special Committee. Maples and Calder (Hong
Kong) LLP is serving as Cayman Islands legal counsel to the Special
Committee.
Simpson Thacher & Bartlett is serving as U.S. legal counsel
to the Buyer Group. Harney Westwood & Riegels is serving as
Cayman Islands legal counsel to the Buyer Group. Jingtian &
Gongcheng is serving as PRC legal counsel to the Buyer Group.
Additional Information about the Merger
The Company will furnish to the U.S. Securities and Exchange
Commission (the “SEC”) a current report on Form 6-K regarding the
Merger, which will include as an exhibit thereto the Merger
Agreement. All parties desiring details regarding the Merger are
urged to review these documents, which will be available at the
SEC’s website (http://www.sec.gov).
In connection with the Merger, the Company will prepare and mail
a proxy statement to its shareholders. In addition, certain
participants in the Merger will prepare and mail to the Company’s
shareholders a Schedule 13E-3 transaction statement that will
include the proxy statement. These documents will be filed with or
furnished to the SEC. INVESTORS AND SHAREHOLDERS ARE URGED TO READ
CAREFULLY AND IN THEIR ENTIRETY THESE MATERIALS AND OTHER MATERIALS
FILED WITH OR FURNISHED TO THE SEC WHEN THEY BECOME AVAILABLE, AS
THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT THE COMPANY, THE
MERGER AND RELATED MATTERS. In addition to receiving the proxy
statement and Schedule 13E-3 transaction statement by mail,
shareholders also will be able to obtain these documents, as well
as other filings containing information about the Company, the
Merger and related matters, without charge, from the SEC’s website
(http://www.sec.gov).
The Company and certain of its directors, executive officers and
other members of management and employees may, under SEC rules, be
deemed to be “participants” in the solicitation of proxies from the
Company’s shareholders with respect to the Merger. Information
regarding the persons who may be considered “participants” in the
solicitation of proxies will be set forth in the proxy statement
and Schedule 13E-3 transaction statement relating to the Merger
when it is filed with the SEC. Additional information regarding the
interests of such potential participants will be included in the
proxy statement and Schedule 13E-3 transaction statement and the
other relevant documents filed with the SEC when they become
available.
This announcement is neither a solicitation of a proxy, an offer
to purchase nor a solicitation of an offer to sell any securities
and it is not a substitute for any proxy statement or other filings
that may be made with the SEC should the Merger proceed.
About BlueCity Holdings Limited
BlueCity (NASDAQ: BLCT) is a world-leading online LGBTQ
community providing a comprehensive suite of services to foster
connections and enhance the wellbeing of the LGBTQ community. The
company fulfills both the daily and lifelong needs of its members
through a wide range of targeted and tailored services, including
social networking, livestreaming and health-related services. With
commitment to providing high-quality user experience, ensuring
privacy protection, and promoting community health and well-being,
BlueCity has captured the hearts and minds of LGBTQ people across
the globe. Available in 13 languages, BlueCity’s mobile app Blued
has connected more than 60 million registered users in about 170
countries and regions.
Forward-looking Statements
This announcement contains forward-looking statements. These
statements are made under the “safe harbor” provisions of the U.S.
Private Securities Litigation Reform Act of 1995. These
forward-looking statements can be identified by terminology such as
“may,” “will,” “expect,” “anticipate,” “aim,” “estimate,” “intend,”
“plan,” “believe,” “is/are likely to,” “potential,” “continue” and
similar statements. Among other things, business outlook and
quotations from management in this announcement, as well as
BlueCity’s strategic and operational plans, contain forward-looking
statements. BlueCity may also make written or oral forward-looking
statements in its periodic reports to the U.S. Securities and
Exchange Commission, in its annual report to shareholders, in press
releases and other written materials and in oral statements made by
its officers, directors or employees to third parties. Statements
that are not historical facts, including but not limited to
statements about BlueCity’s beliefs and expectations, are
forward-looking statements. Forward-looking statements involve
inherent risks and uncertainties. A number of factors could cause
actual results to differ materially from those contained in any
forward-looking statement, including but not limited to the
following: the Company’s goals and strategies; the Company’s
ability to retain and increase the number of users, paying members
and advertisers, and expand its product and service offerings; the
Company’s future business development, financial condition and
results of operations; the expected changes in the Company’s
revenues, costs or expenditures; the Company’s expectation
regarding the use of proceeds from its IPO; competition in the
Company’s industry and its popularity within the LGBTQ population;
and relevant government policies and regulations relating to the
Company’s industry; and the development and impacts of COVID-19.
Further information regarding these and other risks, uncertainties
or factors is included in the Company’s filings with the U.S.
Securities and Exchange Commission. All information provided in
this press release and in the attachment is current as of the date
of the press release, and the Company does not undertake any
obligation to update such information, except as required under
applicable law.
For more information, please contact:
In China:
BlueCity Holdings LimitedInvestor RelationsPhone: +86
10-5876-9662Email: ir@bluecity.com
The Blueshirt GroupMs. Ally WangPhone: +86 139-0106-6802Email:
ally@blueshirtgroup.com
In the United States:
The Blueshirt GroupMs. Julia QianPhone: +1 973-619-3227Email:
Julia@blueshirtgroup.com
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