Actions Semiconductor (ACTS) Agrees to Go Private for $2.20/ADS

September 12, 2016 4:33 PM EDT

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Actions Semiconductor Co., Ltd. (NASDAQ: ACTS) entered into a definitive merger agreement on September 12, 2016 pursuant to which the Company will be acquired by a consortium of investors (the "Buyer Consortium"), including Supernova Investment Ltd. ("Parent") and other certain shareholders of the Company: Surrey Glory Investments Inc., Tongtong Investment Holding Co., Ltd., Perfectech Int'l Ltd, Allpremier Investment Limited, Octovest International Holding Co., Ltd., Ventus Corporation, Middlesex Holdings Corporation Inc, Rich Dragon Consultants Limited, Nutronics Technology Corporation, Uniglobe Securities Limited, New Essential Holdings Limited, Embona Holdings (Malaysia) Limited, Suffolk Dragon Ventures Ltd and Top Best Development Limited (together with Parent, the "Rollover Shareholders").

Pursuant to the terms of the Merger Agreement, at the effective time of the merger, a wholly owned subsidiary of Parent will merge with and into the Company, with the Company continuing as the surviving company (the "Surviving Company"), and each of the Company's ordinary shares, par value US$0.00001 per share, issued and outstanding immediately prior to the effective time of the merger (the "Shares") will be cancelled and cease to exist in exchange for the right to receive US$0.366 in cash without interest, and each American Depositary Share ("ADS") of the Company, every ADS representing six Shares, will be cancelled in exchange for the right to receive US$2.20 in cash without interest, except for (a) certain Shares owned by the Rollover Shareholders, each of which will continue to exist and become one ordinary share, par value of $0.00001 each, of the Surviving Company, (b) Shares (including Shares represented by ADSs) owned by the Company or any of its subsidiaries, (c) Shares reserved (but not yet issued and allocated) by the Company for issuance and allotment upon exercise of any share incentive awards issued under the Company's employee share incentive plans, and (d) Shares held by shareholders who have validly exercised and not effectively withdrawn or lost their rights to dissent from the merger pursuant to Section 238 of the Companies Law of the Cayman Islands (the "Dissenting Shares"), which will be cancelled and cease to exist in exchange for the right to receive the payment of fair value of the Dissenting Shares in accordance with Section 238 of the Companies Law of the Cayman Islands.

The merger consideration represents a premium of 49.7% to the closing price of the Company's ADSs on May 18, 2016, the last trading day prior to the Company's announcement of its receipt of a "going-private" proposal, and a premium of 40.6% to the volume weighted average closing price of the Company's ADSs during the 30 trading days prior to its receipt of a "going-private" proposal. The Buyer Consortium intends to fund the merger through available cash of the Company and its subsidiaries.

The Company's board of directors (the "Board"), acting upon the unanimous recommendation of a committee of independent and disinterested 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 independent financial and legal advisors.

The merger, which is currently expected to close during the last quarter of 2016, 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 present and voting in person or by proxy at a meeting of the Company's shareholders which will be convened to consider the approval of the merger agreement and the merger. Pursuant to a voting and support agreement entered among Parent and the other Rollover Shareholders, the Rollover Shareholders have agreed to vote all the Shares and ADSs beneficially owned by them 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 Select Global Market.

The Company will prepare and file with the U.S. Securities and Exchange Commission (the "SEC") 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.

In connection with the merger, Houlihan Lokey (China) Limited is serving as financial advisor to the Special Committee; Jones Day is serving as U.S. legal counsel to the Special Committee; Maples and Calder is serving as Cayman Islands legal counsel to the Special Committee. K&L Gates LLP is serving as U.S. legal counsel to the Buyer Consortium.

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