Another voice: 58 prostitution tencent behind Shareholders worry cash

hunting cloud network feature

in the 58 city both sides will agree that tencent and on O2O as something different, this pile and hurried deal in ten days, it seems to like independent thinking cloud network editor jun hunting, has a different interpretation. In and after a senior executive communication, more strengthened my view: an important promoting factor in trading, 58 city blocks of shareholders worry.

both sides issued to the media pr manuscript is in line with the logic of “imagination”, jointly build the city of the future 020. But that argument, far from Yao Jinbo told the media more true: want is tencent’s flow and social relations. As a medium of information platform, 58 (at least) is not to have the ability to service 020: it has no further businesses like general comments on closely relationship between network and precipitation, also do not have to cultivate behaviors user 020, it is only a medium of information platform.

and media need most is the traffic.

in a industry executives and after the communication, hunting cloud network editor jun summarizes several “doubt” :

1, 58 results is good, but not many value-added

The Times, tencent get a 19.9% stake in 58 city for $736 million, tencent to 58 valuation is $3.698 billion. 58 city released the latest earnings and earnings outlook are displayed, 58 not only have implemented turnround, and financial revenue is growing rapidly. In such a good background, tencent only 58 for less than $3.7 billion valuation, 58 share price, the highest peak in 58 worth around $4.5 billion.

$3.7 billion and $4.5 billion, to nearly $1 billion price difference, in the case of out of resources for packaging (tencent in jingdong but have assets in the jingdong), under the background of results is good, 58 why willing to accept such a low price?

2, tencent’s money most of the blocks to 58 shareholders

according to the investment agreement, tencent company will be the price of $20 per share of common stock to 58 city subscribe and buy A shares and B shares, A total of 36805000 shares. 58, said to some existing shareholders will repurchase 27603750 shares of class B common stock.

that is in the deal, tencent bid $736 million, 58 shareholders cash out nearly $552 million, 58 reach only $184 million. Good cash the money to shareholders, shareholders in a hurry.

at the same time, and wrote the first point, the shareholders are willing to accept the price of $20 per share of common stock (the equivalent of American depositary shares of $40 per share), but the price is not obvious increment, more can’t and 58 $54 per share to compare today.

there is only one reason to shareholders worry cash out.

left at 3, 58 financing “cold case”

at the end of 2010, HuaPingLing threw 58 total $60 million in financing, including Yao Jinbo personal investment of $5 million. Since then, warburg pincus and chase for $55 million at the end of 2011, of which $13 million obtained by Yao Jinbo personal financing in lending way.

cloud network editor you have to say, hunting Yao Jinbo gumption, borrowing development confidence at the time, but also for the future financing 13 million borrowing cash out the stage: also money always has a time limit.

of course, from the perspective of business combination, tencent did look and 58 have a combination of many, but one thing is certain is that shareholders worry cashed out to promote the achievement of the deal is necessarily important factors.