YY Receives 'going Private' Offer From Chairman, CEO

(RTTNews) - Chinese video-based social network YY Inc. (YY) said Thursday that it has received a buyout offer from a group led by its top executives to take the company private. The offer reportedly values the company at about $3.7 billion.

Guangzhou-based YY said its board of directors received a non-binding proposal letter from Chairman Jun Lei and Chief Executive Officer David Xueling Li, to acquire all of the company's ordinary shares they do not already own, for $68.50 in cash per American Depositary Share. Each ADS represents 20 ordinary shares.

The proposed purchase price represents a 17.4 percent premium to the trading price of the company's ADS on July 8, 2015.

The buyer group currently owns about 35.7 percent of YY's issued and outstanding shares, representing about 75.1 percent of the voting power of the company. The buyer group plans to fund the acquisition with debt and equity capital as well as rollover equity in the company.

YY said its board will form a special committee comprised of independent directors, and will authorize the special committee to retain legal and financial advisors to assist it in evaluating the transaction.

Several other Chinese companies with U.S. listings have also recently received proposals to be taken private. These companies include JA Solar Holdings Co. Ltd. (JASO), Qihoo 360 Technology Co. Ltd. (QIHU), Taomee Holdings Ltd. (TAOM) and Renren Inc. (RENN).

YY is trading at $59.85, up $1.50 or 2.56 percent on a volume of 1.05 million shares.