Chinese online auto platform Autohome (NYSE:ATHM) has received a $31.50/share, non-binding, going-private offer from a consortium including CEO James Zhi Qin, VC firm Sequoia's Chinese arm (Sequoia China), and investment firms Boyu Capital and Hillhouse Capital.
The offer price is 12.1% above Autohome's weighted-average trading price over the last 30 days, but $0.65 below where shares closed today following a 6.6% gain. The buyout group plans to finance the deal with bank financing and its members' existing Autohome stakes.
Autohome finished after-hours trading down 2% to $31.50.
Chinese mobile messaging/gaming giant Tencent (OTCPK:TCEHY) and leading direct online retailer JD.com (JD +0.8%) are directly investing $1.3B in "cash and resources" in major auto site Bitauto (BITA +8.7%), and $250M in Bitauto's YiXin Capital (online auto financing) subsidiary.
JD will directly invest $400M in cash in Bitauto and provide $750M in resources, including "exclusive access to the new and used car channels on JD.com's e-commerce sites including mobile apps and additional support from its key platforms," in exchange for shares. Tencent will directly invest $150M in cash. JD and Tencent will respectively invest $100M and $150M in YiXin Capital.
The deal will leave JD with a 25% stake in Bitauto, and Tencent a 3.3% stake. JD and Tencent will respectively have 17.7% and 26.6% stakes in YiXin Capital. Tencent already has a sizable stake in JD.
Bitauto, whose shares have soared on the news, promises to "aggressively invest to solidify Bitauto's industry leadership and build market share" in upcoming months. Rival Autohome (ATHM +5.8%) is also up sharply, perhaps on hopes a Tencent/JD rival (Alibaba?) will invest in the company in response.