Shanda Interactive Entertainment Limited Enters into Definitive Agreement with Premium Lead Company Limited and New Era Investment Holding Ltd. for Going Private Transaction


SHANGHAI, Nov. 22, 2011 /PRNewswire via COMTEX/ -- Shanda Interactive Entertainment Limited, incorporated in the Cayman Islands ("Shanda" or the "Company") SNDA +0.07%  , a leading interactive entertainment media company in China, announced today that it has entered into an Agreement and Plan of Merger, dated November 22, 2011 (the "Merger Agreement") with Premium Lead Company Limited ("Parent") and New Era Investment Holding Ltd. ("Merger Sub") pursuant to which Parent will acquire Shanda (the "Transaction") for US$20.675 per ordinary share or US$41.35 per American Depositary Share, each representing two ordinary shares ("ADS"). This represents a 26.6% premium over the Company's 30 trading day volume-weighted average price as quoted by NASDAQ on October 14, 2011, the last trading day prior to the Company's announcement on October 17, 2011 that it had received a "going private" proposal. The Transaction values Shanda's equity at approximately US$2.3 billion on a fully diluted basis.

Parent is a British Virgin Islands business company jointly owned by Mr. Tianqiao Chen, Chairman of the Board, Chief Executive Officer and President of Shanda, his wife Ms. Qian Qian Chrissy Luo, who is a non-executive director of Shanda and his brother Mr. Danian Chen, who is the Chief Operating Officer and a director of Shanda (together, "Buyer Group"). Merger Sub is a newly-formed exempted company with limited liability incorporated under the laws of the Cayman Islands and a direct wholly owned subsidiary of Parent. The Buyer Group collectively beneficially owns approximately 69.7% of the outstanding shares of the Company (excluding outstanding options of the Company) and intends to fund the Transaction through a combination of proceeds from a loan facility in the amount of US$180,000,000 from JPMorgan Chase Bank, N.A., cash in the Company and its subsidiaries, and a cash contribution from the Buyer Group.

Pursuant to the Merger Agreement, upon the terms and subject to the conditions thereof, at the effective time of the merger, Merger Sub will be merged with and into the Company, the Company will become a wholly-owned subsidiary of Parent and each of the Company's ordinary shares issued and outstanding immediately prior to the effective time of the merger (including ordinary shares represented by ADSs) will be converted into the right to receive US$20.675 in cash per ordinary share (or US$41.35 in cash per ADS) without interest, except for the ordinary shares (including ordinary shares represented by ADSs): (i) beneficially owned by the Buyer Group which will be cancelled without receiving any consideration and (ii) owned by holders of such ordinary shares who have validly exercised and not lost their appraisal rights pursuant to Section 238 of the Cayman Islands Companies Law, as amended.

The Company's Board of Directors, acting upon the unanimous recommendation of the Special Committee of Independent Directors formed by the Board of Directors, approved the Merger Agreement and the Transaction and resolved to recommend that the Company's shareholders vote to approve the Merger Agreement and the Transaction. The Special Committee, which is composed solely of directors unrelated to any of Parent, Merger Sub, the Buyer Group or any of the management members of the Company, negotiated the terms of the Merger Agreement with the assistance of its financial and legal advisors.

The Transaction, which is currently expected to close before the end of the first quarter 2012, is subject to the approval of the Merger Agreement and the Transaction by an affirmative vote of shareholders representing two-thirds or more of the ordinary shares present and voting in person or by proxy at a meeting of the Company's shareholders which will be convened to consider the approval of the Merger Agreement and the Transaction, as well as certain other customary closing conditions. The Buyer Group benefically owns sufficient ordinary shares to approve the Merger Agreement and the Transaction and have agreed to vote in favor of such approval. If completed, the Transaction will result in the Company becoming a privately-held company and its ADSs will no longer be listed on the NASDAQ Global Select Market.

Bank of America Merrill Lynch is serving as financial advisor to the Special Committee. Weil, Gotshal & Manges LLP is serving as U.S. legal advisor to the Special Committee and Maples and Calder is serving as Cayman Islands legal advisor to the Special Committee. Simpson Thacher & Bartlett LLP is serving as U.S. legal advisor to Bank of America Merrill Lynch.

J.P. Morgan is serving as financial advisor to the Buyer Group. Shearman & Sterling LLP is serving as U.S. legal advisor to the Buyer Group. Clifford Chance is serving as legal advisor to J.P. Morgan.

Davis Polk & Wardwell LLP is serving as U.S. legal advisor to Shanda and Conyers Dill & Pearman is serving as Cayman Islands legal advisor to Shanda.

Additional Information about the Transaction

The Company will furnish to the Securities and Exchange Commission (the "SEC") a report on Form 6-K regarding the Transaction, which will include the Merger Agreement related to the Transaction. All parties desiring details regarding the Transaction are urged to review these documents, which are available at the SEC's website ( ).

In connection with the Transaction, the Company will prepare and mail a proxy statement to its shareholders. In addition, certain participants in the Transaction will prepare and mail to the Company's shareholders a Schedule 13E-3 transaction statement. These documents will be filed with or furnished to the SEC. INVESTORS AND SHAREHOLDERS ARE URGED TO READ CAREFULLY AND IN THEIR ENTIRETY THESE MATERIALS AND OTHER MATERIALS FILED WITH OR FURNISHED TO THE SEC WHEN THEY BECOME AVAILABLE, AS THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT THE COMPANY, THE TRANSACTION AND RELATED MATTERS. In addition to receiving the proxy statement and Schedule 13E-3 transaction statement by mail, shareholders also will be able to obtain these documents, as well as other filings containing information about the Company, the Transaction and related matters, without charge, from the SEC's website ( ) or at the SEC's public reference room at 100 F Street, NE, Room 1580, Washington, D.C. 20549. In addition, these documents can be obtained, without charge, by contacting the Company at the following address and/or phone number:

Shanda Interactive Entertainment LimitedUnit 403A, Golden Centre188 Des Voeux Road CentralHong KongTel: +852-2851-0177

The Company and certain of its directors, executive officers and other members of management and employees may, under SEC rules, be deemed to be "participants" in the solicitation of proxies from our shareholders with respect to the Transaction. Information regarding the persons who may be considered "participants" in the solicitation of proxies will be set forth in the proxy statement and Schedule 13E-3 transaction statement relating to the Transaction when it is filed with the SEC. Additional information regarding the interests of such potential participants will be included in the proxy statement and Schedule 13E-3 transaction statement and the other relevant documents filed with the SEC when they become available.

This announcement is neither a solicitation of proxy, an offer to purchase nor a solicitation of an offer to sell any securities and it is not a substitute for any proxy statement or other filings that may be made with the SEC should the Transaction proceed.

About Shanda Interactive Entertainment Limited

Shanda is a leading interactive entertainment media company in China, offering a broad array of online entertainment content on an integrated service platform to a large and diverse user base. Shanda offers its high quality entertainment content through its subsidiaries and affiliates, including Shanda Games, Cloudary, Ku6 Media, and various other online community and business units. The broad variety of content ranges from massively multi-player online role-playing games (MMORPGs) and advanced casual games, to social network games, e-sports, literature, film, television, music, and video etc. By providing a centralized platform through which Shanda can deliver its own content as well as third-party content, Shanda allows its users to interact with thousands of other users while enjoying some of the best entertainment content available in China today. Shanda: "Interaction enriches your life". For more information about Shanda, please visit .

2005-2011 All Rights Reserved 京ICP备05069564号-1