HONG KONG — According to two people, Weibo Corp chairman Charles Chao and a state investor are in discussions to take the Chinese company private in a deal that would value the Twitter-like company at at least US$20 billion and allow Alibaba Group Holding Ltd to exit.
According to sources and a second individual with firsthand knowledge of the subject, Chao, whose holding company New Wave is the largest shareholder in Weibo, is forming a consortium for the sale with a Shanghai-based state firm.
The state firm’s identity could not be determined right away.
According to the company’s 2020 annual report, New Wave held a 45 percent interest in Weibo in February, valued at US$5.6 billion based on the stock’s Friday price, followed by Alibaba with a 30 percent share worth US$3.7 billion.
Two sources told Reuters that the consortium is looking to pay between US$90 and US$100 a share to take Weibo private, representing an 80 percent to 100 percent premium over the stock’s recent average price of US$50.
According to the sources, privatizing China’s largest microblogging platform would allow Alibaba, the company’s second largest shareholder and top client, to sell out, effectively selling one of its core media assets.
Due to confidentiality concerns, the sources declined to be identified.
Chao did not react to a Reuters request for comment sent through Sina, the parent company of Weibo.
Requests for comment on Weibo and Alibaba were also ignored.
(In Hong Kong, Julie Zhu and Pei Li reported; Sumeet Chatterjee and Jason Neely edited)/n
