Alibaba Offer to Take AutoNavi Private Shoots AMAP Stock Higher

by Christopher Freeburn | February 10, 2014 9:28 am

Alibaba Offer to Take AutoNavi Private Shoots AMAP Stock Higher

Alibaba185 Alibaba Offer to Take AutoNavi Private Shoots AMAP Stock Higher[1]Shares of AutoNavi Holdings Limited (AMAP[2]) jumped more than 24% in Monday pre-market trading after a Chinese Internet giant offered to buy the digital mapping company[3].

Alibaba already holds a 28% stake in AMAP. Now, China’s biggest online retailer says it will pay $21 per AMAP share to purchase the remainder of the company. The Alibaba offer is 27% higher than AMAP’s closing price on Friday. That would price the Alibaba full acquisition of AMAP at $1.45 billion, Reuters notes.

AMAP said that its board would appoint a special committee to consider the all-cash Alibaba proposal.

Yahoo (YHOO[4]) retains a 24% stake in Alibaba. Yahoo had previously held a 40% stake in Alibaba, but sold much of that stake in 2012 to raise cash[5].

Analysts are looking forward to an eventual Alibaba IPO in the U.S[6]. Acquiring AMAP would allow Alibaba to boost its presence in mobile services.

News of the deal sent YHOO stock up about 2% in premarket trading.

Endnotes:
  1. [Image]: http://investorplace.com/wp-content/uploads/2013/11/Alibaba185.jpg
  2. AMAP: http://studio-5.financialcontent.com/investplace/quote?Symbol=AMAP
  3. offered to buy the digital mapping company: http://www.reuters.com/article/2014/02/10/us-autonavi-offer-idUSBREA190XB20140210
  4. YHOO: http://studio-5.financialcontent.com/investplace/quote?Symbol=YHOO
  5. but sold much of that stake in 2012 to raise cash: http://investorplace.com/2012/05/yahoo-has-sold-the-alibaba-family-silver/#.UvjhJHlhOf0
  6. to an eventual Alibaba IPO in the U.S: http://investorplace.com/ipo-playbook/alibaba-ipo-delayed-yhoo-stock/#.UvjhFXlhOf0

Source URL: http://investorplace.com/2014/02/alibaba-offer-take-autonavi-private-shoots-amap-stock-higher/
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