Wanda Sports Group has formed an independent committee to consider a proposal from a Dalian Wanda subsidiary to buy the outstanding Class A ordinary shares in the sports marketing firm and potentially delist it from the stock exchange.
Last Wednesday it was announced that Nasdaq-listed Wanda Sports Group Company Limited, which includes the Infront agency, had received a non-binding proposal to acquire all outstanding Class A ordinary shares in the firm from Wanda Sports & Media (Hong Kong) Holding Co. Limited. The latter is a limited liability company that forms part of Wang Jianlin’s wider multinational Dalian Wanda conglomerate.
The Hong Kong-based holding company is offering $2.50 (€2.12) in cash per ADS (American depositary share) or $1.67 per Class A ordinary shares in a move that would effectively take the company private again. The proposed buyer has also indicated it would be prepared to consider alternative structures, including acquiring Class A Ordinary Shares and ADSs at the same price.
A statement from WSG said an independent committee board consisting of the company’s independent directors Edwin Fung and Kenneth Howard Jarrett would weigh up the proposal but gave no guarantee the deal would go ahead.
“The Board and the Independent Board Committee caution the Company’s shareholders and others considering trading the Company’s securities that the Board just received the Proposal and no decisions have been made with respect to the Company’s response to the Proposal,” the statement said.
“There can be no assurance that any definitive offer will be made or that any transaction will be launched or consummated.”
WSG has endured a bumpy ride since making its Nasdaq debut in 2019 with a drastically downsized share price of $8 and a total IPO of $190.4 million. The share price has taken a further dip since the Covid-19 pandemic stuck with the company reporting a 75 per-cent fall in second quarter revenues due to widespread lockdown restrictions.
Delisting WSG would remove the need for the company to publish its financial results, as per the requirement of the US Securities and Exchange Commission (SEC) and Nasdaq.
The company said it would not provide any updates with respect to any transaction, except as required by law.