Underrated Perfect Betting Hand Tour

Gaming companies are experiencing "ice and fire two days" on the capital market, while the company launched a tour of the listed craze, the other side is the old online games manufacturers opt to retire.

After the giant, grand game announced privatisation, January 2, the perfect World announced the company's chairman Chi on December 31, 2014 issued a 20-dollar per share of the proposal for privatization, stimulated by the news, in the Friday, during the regular trading of the Nasdaq Stock market, The perfect World share price rose 3.49 US dollars, at $19.25, or 22.14%, with the perfect world's highest stock price of 26.25 dollars over the past 52 weeks, with a minimum price of $14.78.

For the privatisation proposal, the perfect world response, the perfect World Board has formed a special committee of three independent directors (hereinafter "the Independent Commission") to assess the proposal. The Board had just received a preliminary, non-binding proposal from Mr. Pool, and the independent commission had yet to make any decision on how the perfect world would respond.

Underestimated perfection

In the proposed letter, Chi proposed a premium of 20.00 dollars per share of U.S. depository shares (ADS) or $4 per share of common stock to acquire all the other perfect world shares he has not yet held, a price equivalent to a 25.7% on the basis of the perfect World December 30, 2014 equity closing. The source of funding is to plan to raise funds for this transaction in the form of a combination of debt and equity.

Behind the privatization proposal, it is the reality that the perfect World, giants, Shanda and other Chinese gaming companies are undervalued by the U.S. capital markets.

Shanda Network CEO Chen has repeatedly stated publicly that "Wall Street does not understand Chinese games." "While these companies have a healthy cash flow and a continuing ability to absorb money, the current Shanda game has a 7 times-fold earnings ratio, the perfect p/E ratio is now 9.49 times times, and the Nasdaq's average price-to-earnings ratio is about 20 times times." Previously, the perfect also participated in Shanda's privatisation consortium, but then withdrew.

Fosun International has been the largest shareholder of its organization by buying perfect world stocks from the two-tier market. Chan Zhonghua, managing director of Fosun's cultural industry, believes that the perfect world of stocks is undervalued, and there will be more in the future to privatize.

Chan Zhonghua revealed that Fosun in 2012 to invest in the perfect world, found that the domestic game company's valuation there are two major upside down, a lot of upside down phenomenon still exists today.

First is the primary market and the two-tier market upside down: Some listed companies in the acquisition of game companies to give the acquisition of PE has reached 15 times times, but in fact, the two-tier market many companies not even 15 times times the PE, and the other is the overseas market and the two market upside down: The A-share market average P/e ratio of 30 times times to 50 times times, 100 times times worse. Some of the best gaming companies listed in the US have a price-to-earnings ratio of more than 10.

China's online gaming companies have long been not recognized by Wall Street, there has been a summary of the industry, on the one hand, because of the traditional end of the overall growth fatigue, on the other hand, because of the policy risk and research and development risk, predictability is poor. But at the same time, with the hands of the industry outbreak, a-share listed game company's market value is rising, the price-earnings ratio is too frequently. For example, the Sino-Green PO's P/E ratio of more than 100 times times, palm technology, God Interactive Backdoor branch Crown Wood after the P/E ratio is also far beyond the perfect, grand P/E.

Valuation of the huge difference, become the net swims in the share of privatization, return a share of power.

Not long ago, the perfect surrender of the third quarter of 2014 results showed that the total revenue of 974.3 million yuan, an increase of 18.7%, the net profit attributable to the company's shareholders is 60.7 million yuan, down about 50% year-on-year. As at September 30, 2014, the total cash and cash equivalents held by the perfect world amounted to $1.2786 billion ($ 208.3 million).

Betting on a hand tour

At the same time as the privatisation proposal, the perfect world also announced that the company had appointed Zhang Yunfan as the chief operating officer. Public information shows that Zhang Yunfan joined the perfect World in February 2013, as vice president of the company, and thereafter as the company's senior vice president, responsible for the company's mobile game distribution business. Zhang Yunfan a bachelor's degree in economics from Jiangxi University of Finance in 2003, and subsequently received an MBA from the National University of Singapore in 2013.

"Zhang Yunfan came to perfection, the main thing to do is hand-tour distribution and gaming media business, promoted to COO, also shows that the current performance of competitors or the future affirmation and expectations. "A person close to the perfect world evaluates.

Last October, the perfect World announced a reorganization of its research and development team, setting up five new subsidiaries, while the perfect world holds most of the five subsidiaries. The perfect reorganization of the new architecture, is intended to speed up the game development progress, to ensure that the game design more flexible, according to market trends to make rapid response, so as to improve game development efficiency. It is noteworthy that the restructuring of the five subsidiaries of the business is the focus of the hand tour.

In the hand tour industry adjustment period, the first to seize the market to live more important, and constantly increase the investment in research and development and market costs to bring short-term burning money or the pressure on profits, in the long run may enhance the competitiveness of enterprises. The choice to privatize at this time, for the perfect means to remove the burden of performance pressure, put more effort on business operations.

Guixe, the giant's president, also said privatisation was giving the giant network a breather. "In the past quarter, the company's operating pressure is very large, but also often lead to corporate strategic short-sighted, so that there are problems in product planning." ”

And people close to the perfect world told reporters, in accordance with the present perfect layout, the previous 2014-year perfect film and television 2.7 billion yuan backdoor Jinlei shares complete the domestic listing, and now whether the hand tour or film and television, are the capital market in pursuit of cultural and creative industries, if the future will be "online games + film" packaging into the "More Perfect" A A-share or Hong Kong listing, is not a good way.