Shares price at premium of about 7.5% over the closing price of ADSs
By Susanna Moon
Chicago, July 14 – VisionChina Media Inc. said it will raise about $9.8 million in a private placement of common shares. The purchase price represents a premium of about 7.5% over the closing price of the company's ADSs for the previous trading day before the agreement date, according to a company notice.
Under a purchase agreement, China Special Situations Holdings (1) (BVI) Ltd. will purchase newly issued common shares of VisionChina Media at $12.90 per American Depositary Share, each representing 20 common shares, or the equivalent of about $0.645 per share.
At closing, the investor will hold about 13% of the company's issued and outstanding share capital and will become one of the company's largest shareholders.
Proceeds will be used to fund the company’s working capital and out-of-home interactive media growth initiatives.
Under the terms of the agreement, VisionChina will receive 20% of the total proceeds in cash and a promissory note for the remaining 80% within 10 business days after the signing of the agreement.
The transaction is expected to close by Sept. 11, when the full purchase price is received by VisionChina, the company said.
VisionChina operates an out-of-home advertising network on mass transportation systems, including buses and subways. The company is based in Shenzhen, China.
| Issuer: | VisionChina Media Inc.
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| Issue: | Common stock
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| Amount: | $9.8 million (approximate)
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| Price: | $12.90 per ADS
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| Warrants: | No
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| Investor: | China Special Situations Holdings (1) (BVI) Ltd.
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| Settlement: | Sept. 11
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| Stock symbol: | Nasdaq: VISN
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| Stock price: | $12.00 at close July 14
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| Market cap: | $58.02 million
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