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After the takeover tripped over regulatory hurdles, the ‘Consumer Business’ will be sold to the same consortium for US$600 million
Opera Software announced today the US$1.24 billion takeover by a Chinese consortium of companies has failed because the ‘Offerors’ failed to win regulatory approval, according to an announcement provided to e27 by Opera.
The deal needed to be approved by both American and Chinese regulators and conditions were not met ahead of the July 15 drop-dead date.
Rather than a full takeover, Opera will now sell its consumer-facing products for US$600 million to the same group. The closing of this alternative deal is expected to take place at the end of Q3 2016.
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The Chinese consortium included a variety of private equity funds and notable tech companies like Qihoo 360 (a cybersecurity company) and Beijing Kunlun Tech Co. (an Internet company with resources in mobile gaming, Internet banking and a software store).
According to the document, the services being sold were referred to as the ‘Consumer Business’. They are as follows:
- Mobile browser
- Desktop browser
- Performance and Privacy Apps
- Opera’s technology licensing business
- Opera’s 29.09 per cent ownership in Chinese joint venture nHorizon
The Opera Mediaworks, Opera Apps & Games and Opera TV services will remain owned by the Norwegian company.
CEO Lars Boilesen will serve in his capacity for both parts of the company until the end of the year, at which point he will no longer have a role in the Consumer Business and will focus on Opera. COO Andreas Thome and CFO Frode Jacobsen will work in the Consumer Business moving forward.
Conditions for a successful transaction include finalising the reorganisation of the Consumer Business, an absence of events that would harm the overall value of the Consumer business and approval at a general meeting in Beijing Kunlun Tech.
Part of the condition for the alternative agreement was the consortium agreed that the drop-date would not be extended. The drop-dead date for the new agreement is October 31, 2016 (under certain unspecified circumstances it can be extended to December, 31 2016).
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The news comes after Opera stocks tumbled last week when the company alerted the public that the consortium was struggling to receive regulatory approval, according to Reuters.
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