Jiayuan.com (DATE) Buyout Offer Should Be More Than Doubled, Heng Ren Says

Heng Ren Investments, which dubs itself a friendly activist, is out claiming the $5.37/ADS "going private" offer for Jiayuan.com (NASDAQ: DATE) is "too low" and should be more than doubled.

In a letter to Jiayuan.com’s Board of Directors, Heng Ren said its appraised value of the company is $11.74 per share, or 119% above the current offer.

The firm claims that Vast Profit's proposed offer "appears to be a very opportunistic offer that is disadvantageous to shareholders." They note the offer is a mere 15.7% premium to the 52-week bottom, and is significantly below the $11.00 per share IPO price more than four years ago.

Heng Reng used three valuation methods for Jiayuan.com to come up with their $11.74/share appraised price: 1) Peer Comparison Based on Enterprise Value 2) Discounted Cash Flow (DCF) 3) Leveraged Buyout (LBO).

The firm's letter to the Board of Directors can be found here.

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