NQ Mobile (NQ) Updates on FL Mobile Divestiture; Agrees to Revert Sale of 5.66% Equity Interest
- Donald Trump Sworn in as 45th U.S. President
- Wall Street ends higher as Trump becomes president
- Walgreens Boots Alliance (WBA) Said to Face Antitrust Concern for Rite Aid (RAD) Fix - Bloomberg
- Bristol-Myers Squibb (BMY) Says It Won't Pursue Accelerated U.S. Regulatory Pathway for Opdivo Plus Yervoy in Lung Cancer
- Apple (AAPL) Sues Qualcomm (QCOM) Over Patent Royalties in Antitrust Case - Bloomberg
Get access to the best calls on Wall Street with StreetInsider.com's Ratings Insider Elite. Get your Free Trial here.
NQ Mobile Inc. (NYSE: NQ) announced an update on the divestment of FL Mobile Jiutian Technology Co., Ltd. ("FL Mobile"), the Company's consolidated affiliated entity (the "FL Mobile Divestment"). Following the termination of the transaction between the Company and Shenzhen Prince New Materials Co., Ltd. ("Shenzhen Prince"), as announced on November 2, 2016, Dr. Vincent Wenyong Shi, chairman and chief operating officer of the Company, and Xinjiang Yinghe Equity Investment Management Limited Partnership ("Xinjiang Yinghe"), an affiliate of the management of FL Mobile, recently exercised their options to revert some of the transactions regarding the equity interests in FL Mobile.
Pursuant to the agreement between Dr. Vincent Wenyong Shi and the Company in connection with the sale of 22% equity interest in FL Mobile as announced on March 24, 2016, both parties have an option to request the reversal of the transaction contemplated thereunder in certain circumstances. Following the recent termination of the transaction with Shenzhen Prince, Dr. Shi and the Company agreed to revert the sale of 5.66% equity interest in FL Mobile. As the result of the reversal, the equity interests in FL Mobile purchased by Dr. Shi under such transaction was changed to 16.34%, and the consideration was adjusted proportionately from RMB880 million to RMB653.6 million. Dr. Shi has in the same time entered into a series of contractual arrangements with Xinjiang NQ Mobile Venture Capital Investment Co., Ltd. ("Xinjiang NQ"), a consolidated affiliate of the Company, for Dr. Shi to act as the nominee shareholder of the 5.66% equity interest on behalf of Xinjiang NQ going forward. After obtaining the effective control of the 5.66% equity interests in FL Mobile through relevant contractual arrangements, Xinjiang NQ controls 51% equity interests in FL Mobile.
Similarly, pursuant to the agreement between Xinjiang Yinghe and Xinjiang NQ, both parties have the option to revert the sale of 12% of equity interests in FL Mobile as announced on August 9, 2016 under certain circumstance. Xinjiang Yinghe and the Company recently agreed to revert the sale of 12% equity interests in FL Mobile. Xinjiang Yinghe has in the same time entered into a series of contractual arrangements with Xinjiang NQ for Xinjiang Yinghe to act as the nominee shareholder of the 12% equity interest on behalf of Xinjiang NQ.
After obtaining the effective control of the 5.66% equity interest in FL Mobile back from Dr. Shi and the 12% equity interests in FL Mobile back from Xinjiang Yinghe through relevant contractual arrangements, the Company now controls 63% of equity interests in FL Mobile. In addition to the 63% of equity interests in FL Mobile controlled by the Company, the other shareholders include Dr. Vincent Shi's 16.34% as announced and updated here; Jinxin Hengrui's 13.13% as announced on May 6, 2016; Jinxin Haoyue's 3.53% as announced on August 9, 2016; Jinxin Huatong's 3% as announced on August 9, 2016; and Tibet Zhuohua's 1% as announced on August 9, 2016.
Dr. Shi is the chairman and chief operating officer of the Company and Xinjiang Yinghe is an affiliate of the management of FL Mobile, thus the transactions described above qualify as related party transactions and have been approved by the Company's board of directors and the audit committee. The Company is in discussion with other shareholders of FL Mobile to explore alternative options or deal structures for the FL Divestment.
Serious News for Serious Traders! Try StreetInsider.com Premium Free!
You May Also Be Interested In
- Ethicon Announces Acquisition of Megadyne Medical Products (JNJ)
- PPG Industries (PPG) Acquires Assets of Futian; Terms Not Disclosed
- UPDATE: Federal Judge to Block Anthem (ANTM), Cigna Corp. (CI) Merger - NYP
Create E-mail Alert Related CategoriesCorporate News, Mergers and Acquisitions, Spinoffs
Sign up for StreetInsider Free!
Receive full access to all new and archived articles, unlimited portfolio tracking, e-mail alerts, custom newswires and RSS feeds - and more!