China digital MBO approved by SASAC Guo Wei turned company's third largest shareholder

China's IT industry to date the largest management buy-out (MBO) has passed the SASAC's approval, is nearing completion.　　October 29, the main participant of the deal, Yan, chief partner of the Fund, confirmed to Caijing correspondent that the State Council has approved the management buyout of Shenzhou Digital Holdings Limited (Hong Kong Exchange Code: 0861, hereinafter called Digital China). In August this year, the first shareholder, Lenovo Holdings, which holds a 47.43% per cent stake in digital China, sold 29.6% per cent to the fund, the Hong Yi Investment and the IDG three funds, and another shareholder in Digital China, GA, sold 13.34% per cent to the Shenzhou Digital CEO Guo Wei and the fund.　　Shenzhou Digital October 25 announced that the company's share change transactions have been approved by the Chinese government authorities. After the completion of the transaction, the rich investment fund will become the largest digital China shareholder, holding 20.15%, Lenovo Holdings still hold a digital 17.83% stake in China, become the second largest shareholder.　　Shenzhou Digital President and CEO Guo Wei through its wholly-owned Kil company, indirectly holding the digital 10.29% shares in China, from professional managers up to the company's third largest shareholder.　　Because the Chinese Academy of Sciences in Lenovo Holdings accounted for the main stake, so Lenovo Holdings in the transfer of digital Chinese equity transactions need to obtain approval of the SASAC. In view of the incentive for senior executives of overseas listed companies, Sasac tried out the pilot measures for the implementation of equity incentive in state-controlled listed companies (overseas) in March 2006.　　It stipulates that the total number of grants granted to the incentive shall not exceed 10% of the total amount of the company's equity, and the number of individuals awarded should be less than 1% of the total amount of equity. However, Yan said that the digital China transaction does not apply to SASAC's provisions, because the state-funded Committee's provisions are aimed at the management of the equity incentive, and digital This is the management of the direct use of cash to buy shares in the open market. "As long as the price is fair, anyone can buy it."　　"Yan said.　　In this transaction, its and other three funds and Guo for the bid is 3.5 Hong Kong dollars per share, compared to the company before the suspension of 3.6 yuan per share of 2.78%, a total of HK $13.18. With more than 10% per cent of the takeover, a full offer has been triggered under the terms of the HKEx.　　Yan said the full offer would need to be two before the deal really ended. Shenzhou Digital, a person said, the digital China in Lenovo holding subsidiaries of the relative embarrassment, the MBO will straighten out the relationship with the majority shareholder.　　The source said digital China engaged in software and services, in the domestic leading position, but the majority of shareholders did not give enough attention to the digital China strategy has been shaken, leading to the Digital China strategy is not fast enough, in the rapid progress of competitors, the digital China is in a passive state. Yan said that the rich investment fund to participate in the digital China MBO, one is optimistic about the software service industry, the second is to believe that the digital China through MBO restructuring equity structure, fromA state-owned enterprise becomes a "genuine" listed company, will be better to create value.