Wednesday June 25, 07:48 AM
China's Xinhua Finance to sell Mergent, Kinetic to Carousel Capital Partners
BEIJING (XFN-ASIA) - Xinhua Finance Ltd said it has signed an agreement to sell US financial data company Mergent Inc and UK-based Kinetic Information System Services Ltd to private equity fund Carousel Capital Partners III LP for 93.5 mln usd in cash.
The transaction is expected to close this month, and within 45 days of the closing, Xinhua Finance will make an offer to repurchase about 50 mln usd of its outstanding 100 mln usd 10 pct senior guaranteed notes due 2011.
The decision follows a review of the operations of Tokyo-listed Xinhua Finance (TSE 9399).
According to Xinhua Finance chief executive Jae Lie, the move is the first step of the company's overall strategy to focus on its core business of providing information on China's financial sector.
'We continue to be committed to streamlining our operations and focusing on growing our core businesses in China,' Li said in a statement.
Xinhua Finance chief financial officer David Wang added that some of the sale proceeds will be applied to high growth opportunities in China, given the challenging economic conditions in the US.
The redemption of bonds will also reduce Xinhua Finance's long-term indebtedness, Wang added.
'If our offer to repurchase bonds is accepted by bondholders, we expect that this redemption will decrease interest expense on the bond by approximately five mln usd annually,' he said.
Shanghai-based Xinhua Finance has a range of financial services and owns the Xinhua Finance newswire.
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