CNinsure Inc. (Nasdaq:CISG) (the "Company" or "CNinsure"), a
leading independent insurance intermediary company operating in
China, announced today that its Board of Directors has received a
preliminary non-binding proposal letter dated May 14, 2011, from
TPG Asia V MU, Inc. ("TPG Asia"), Kingsford Resources Limited, a
company controlled by Mr. Yinan Hu, chairman of the Board of
Directors and chief executive officer of the Company, and entities
affiliated with him (collectively, the "Founder"), and CDH
Inservice Limited ("CDH", together with TPG Asia and the Founder,
the "Consortium Members"), to acquire all of the outstanding
ordinary shares of the Company, other than certain American
Depositary Shares ("ADSs") or ordinary shares held by the Founder
and CDH, in a going private transaction for $19.00 per ADS, or
$0.95 per ordinary share, in cash, subject to certain conditions.
The Founder and CDH currently beneficially own, in the aggregate,
approximately 34.3% of the Company's outstanding ordinary shares.
According to the proposal letter, the acquisition is intended to
be financed by equity capital from the Consortium Members, and
would not be contingent on the Consortium Members obtaining any
debt financing. A copy of the proposal letter is attached hereto as
Exhibit A.
The Board of Directors, other than Mr. Yinan Hu, Mr. Qiuping Lai
and Dr. Shangzhi Wu, is reviewing and evaluating the proposal and
the Board of Directors cautions the Company's shareholders and
others considering trading in its securities that no decisions have
been made with respect to the Company's response to the proposal.
There can be no assurance that any definitive offer will be made,
that any agreement will be executed or that this or any other
transaction will be approved or consummated.
About CNinsure Inc.
CNinsure is a leading independent insurance intermediary company
operating in China. CNinsure's distribution network reaches many of
China's most economically developed regions and affluent cities.
The Company distributes a wide variety of property and casualty and
life insurance products underwritten by domestic and foreign
insurance companies operating in China, and provides insurance
claims adjusting as well as other insurance-related services.
Forward-looking Statements
This press release contains statements of a forward-looking
nature. These statements are made under the "safe harbor"
provisions of the U.S. Private Securities Litigation Reform Act of
1995. You can identify these forward-looking statements by
terminology such as "will," "expects," "believes," "anticipates,"
"intends," "estimates" and similar statements. These
forward-looking statements involve known and unknown risks and
uncertainties and are based on current expectations, assumptions,
estimates and projections about CNinsure and the industry.
Potential risks and uncertainties include, but are not limited to,
those relating to whether any definitive offer will be made,
whether any agreement will be executed or whether this or any other
transaction will be approved or consummated, as well as CNinsure's
limited operating history, especially its limited experience in
selling life insurance products, its ability to attract and retain
productive agents, especially entrepreneurial agents, its ability
to maintain existing and develop new business relationships with
insurance companies, its ability to execute its growth strategy,
its ability to adapt to the evolving regulatory environment in the
Chinese insurance industry, its ability to compete effectively
against its competitors, quarterly variations in its operating
results caused by factors beyond its control and macroeconomic
conditions in China and their potential impact on the sales of
insurance products. All information provided in this press release
is as of May 16, 2011, and CNinsure undertakes no obligation to
update any forward-looking statements to reflect subsequent
occurring events or circumstances, or changes in its expectations,
except as may be required by law. Although CNinsure believes that
the expectations expressed in these forward-looking statements are
reasonable, it cannot assure you that its expectations will turn
out to be correct, and investors are cautioned that actual results
may differ materially from the anticipated results. Further
information regarding risks and uncertainties faced by CNinsure is
included in CNinsure's filings with the U.S. Securities and
Exchange Commission, including its annual report on Form 20-F.
Exhibit A |
May 14, 2011 |
The Board of Directors |
CNinsure Inc. |
22nd Floor, Yinhai Building |
No. 299 Yanjing Zhong Road |
Guangzhou, Guangdong 510110 |
People's Republic of China |
Dear Sirs:
TPG Asia V MU, Inc. ("TPG Asia"), Kingsford Resources Limited, a
company incorporated under the laws of the British Virgin Islands,
which is controlled by Mr. Yinan Hu, chairman of the board of
directors (the "Board") and chief executive officer of CNinsure
Inc. (the "Company"), and entities affiliated with him
(collectively, "Founder") and CDH Inservice Limited ("CDH") are
pleased to submit this preliminary non-binding proposal to acquire
the Company in a transaction (the "Acquisition") in which each
ordinary share of the Company would be cancelled in consideration
for the right to receive $19.00 per American Depositary Share
("ADS", each ADS representing 20 ordinary shares of the Company),
or $0.95 per ordinary share (the "Acquisition Consideration"),
other than certain ADSs or ordinary shares ("Excluded Shares") held
by Founder and CDH which would be cancelled in the Acquisition and
would not receive the Acquisition Consideration. Our proposal
provides a very attractive opportunity to the Company's
shareholders to realize superior value and represents a premium of
44.4% to the Company's closing price on May 13, 2011 and a premium
of 38.4% to the volume-weighted average closing price during the
last 30 trading days. The material terms and conditions related to
our proposal and the Acquisition are set forth below. We are
confident that the Acquisition can be closed on the basis as
outlined in this letter.
1. Consortium
TPG Asia, Founder and CDH (collectively, the "Consortium
Members") have entered into a consortium agreement pursuant to
which we will form an acquisition company for the purpose of
implementing the Acquisition, and have agreed to work with each
other exclusively in pursuing the Acquisition. Please also note
that Founder and CDH are currently only interested in pursuing the
Acquisition and have no interest in selling their shares in any
other transaction involving the Company.
2. Acquisition Consideration
The consideration payable in the Acquisition will be $19.00 per
ADS (other than Excluded Shares), or $0.95 per ordinary share
(other than Excluded Shares), in cash. As of the date hereof,
Founder and CDH, individually, beneficially own ordinary shares of
the Company representing, in the aggregate, approximately 34.3% of
the Company's outstanding ordinary shares.
3. Funding
The Acquisition will be funded by equity capital from the
Consortium Members. The consortium agreement sets forth the current
terms under which the equity funding will occur. We expect
definitive commitments for the required equity funding, subject to
terms and conditions set forth therein, to be in place when the
Definitive Agreements (as defined below) are signed. The
Acquisition would not be contingent upon our obtaining any debt
financing.
4. Due Diligence
We will require a timely opportunity to conduct customary due
diligence on the Company.
5. Definitive Agreements
We are prepared to promptly negotiate and finalize definitive
agreements (the "Definitive Agreements") providing for the
Acquisition and related transactions. These documents will provide
for representations, warranties, covenants and conditions which are
typical, customary and appropriate for transactions of this
type.
6. Process
We believe that the Acquisition will provide superior value to
the Company's shareholders. We recognize that the Board will
evaluate the Acquisition independently before it can make its
determination to endorse it. Given the involvement of Founder and
CDH in the Acquisition, we would expect that the independent
members of the Board will proceed to consider our proposal and the
Acquisition.
7. About TPG
TPG is a leading private investment firm with approximately $48
billion of assets under management and offices in San Francisco,
Beijing, Fort Worth, Hong Kong, London, Luxembourg, Melbourne,
Moscow, Mumbai, New York, Paris, Shanghai, Singapore and Tokyo. TPG
has extensive experience with global public and private investments
executed through leveraged buyouts, growth investments, joint
ventures, spinouts and restructurings. TPG has a history of over 15
years investing in the People's Republic of China, and has one of
the largest investment portfolios in the People's Republic of China
today, with a successful track record of investments such as
Lenovo, Daphne, WuMart, China Grand Auto, NT Pharma and
ShangPharma, and particularly in the financial services sector
including Shenzhen Development Bank, UniTrust Finance and China
International Capital Corporation.
8. About CDH
CDH China Growth Capital Fund II, L.P. ("CDH Fund II") owns 100%
of the total outstanding shares of CDH Inservice Limited. CDH China
Growth Capital Holdings Company Limited is the general partner of
CDH Fund II. CDH China Management Company Limited and its
affiliates are international alternative fund managers focusing on
investments in private equity, venture capital, real estate and
public equity markets. CDH and its affiliates have been managing
funds since 2002, have over $6.1 billion assets under management
and have more than 100 institutional investors, including sovereign
wealth funds, pension funds, endowments, family offices, and fund
of funds.
9. No Binding Commitment
This letter constitutes only a preliminary indication of our
interest, and does not constitute any binding commitment with
respect to an Acquisition. Such a commitment will result only from
the execution of Definitive Agreements, and then will be on the
terms provided in such documentation.
10. Public Disclosure
In light of United States securities laws requirements, Founder
and CDH will be making filings with the Securities and Exchange
Commission on Schedule 13D in which this letter will be publicly
disclosed.
In closing, we would like to personally express our commitment
to working together to bring this Acquisition to a successful and
timely conclusion. Should you have any questions regarding this
proposal, please do not hesitate to contact us. We look forward to
hearing from you.
By: Sing Wang |
For and on behalf of |
TPG Asia V MU, Inc. |
By: Yinan Hu |
By: Kiang Hua Lew |
For and on behalf of |
CDH Inservice Limited |
CONTACT: Oasis Qiu
Investor Relations Manager
Tel: +86-20-61222777x850
Email: qiusr@cninsure.net
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