Chinese tech firms entice Opera with $1.2 billion buyout bid
Chinese tech firms entice Opera with $1.2 billion buyout bid | Ars TechnicaOpera Software, which is best known for its browser of the same name, has urged its shareholders to accept a buyout offer from a Chinese consortium that values the Norway-based company at ?820 million ($1.2 billion).
The acquisition bid comes from a number of Chinese tech firms, including Qihoo--a leading security software company--and mobile Internet provider Kunlun. Opera has been looking for what it calls "strategic opportunities" since August last year, and said that its decision to recommend the offer, led by the Golden Brick Silk Road Fund Management of China, came after "careful consideration of the various opportunities for the company and the proposals received."
Opera's board and shareholders in its management team unanimously accepted the offer. In addition, "larger shareholders representing approximately 33 percent of the Opera shares outstanding, have undertaken to accept the offer for their shares in the company." The Chinese consortium said it was offering 71 NOK (about ?5.60) per share, a premium of around 50 percent compared to the recent value of shares, which makes it quite likely that the offer will be accepted by the 90 percent threshold of shareholders needed for the deal to go through.
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Separately on Wednesday, Opera trumpeted record financial results for its fourth quarter: ?130 million ($193.5 million) in sales, and profits of ?22 million ($32.8 million) for the final three months of 2015. Most of its revenue came from mobile advertising. The company projected 2016 revenue of around ?480 million ($700 million), and an expected profit of about ?75 landscaping companies in DC million ($110 million).
Despite those healthy figures, Opera Software has always been seen as the company behind the "other" browser, which is rather overshadowed by Chrome, Firefox, and Internet Explorer--even though Opera continues to command a loyal userbase. The company said that it "enables more than 350 million Internet consumers worldwide to connect with the content and services that matter most to them."
Opera explained the "strategic rationale" behind the proposed acquisition by the Chinese consortium as follows:
The Consortium consists of the leading Chinese Internet firms Kunlun and Qihoo, backed by the investment funds Golden Brick and Yonglian.
The transaction would give Opera access to the extensive Internet user base of Kunlun and Qihoo in China as well as the financing and other support of the Consortium that would allow for the full potential of the company to be realised.
The main impact of the planned buyout is likely to be felt in China, as Kunlun and Qihoo roll out products that use Opera's technology there. Current users of Opera products in the West could benefit from the greater resources available for research and development, and a more certain long-term future for Opera's products.
The Opera buyout bid represents an interesting sign of the growing appetite that Chinese companies have for acquiring Western firms, both to bring in advanced technologies to their home market, as well as to expand their global reach.
This post originated on Ars Technica UK