Razer Surges As Execs Plan Privatisation At Almost Double Its Average Price
Chairman Min-Liang Tan and non-executive director Kaling Lim, with a combined stake of nearly 60% in Razer, are leading the consortium, which is offering up to HKD 4.00 per share. Over the past month, Razer’s average price was HKD 2.10.
The consortium’s price point suggests the group believes Razer is incredibly undervalued. The group is also in talks with private equity firm CVC Capital Partners for the buyout.
KKR – a U.S. headquartered private equity firm – has also looked at the deal.
However, a regulatory filing on Tuesday by Razer said there was no certainty that the discussions would lead to an agreement on the transaction.
In an October filing, Razer revealed Tan and Lim were in preliminary talks with financial investors regarding a transaction.
Talks have advanced and the consortium is looking to announce the deal by the end of 2021.
Shares of the Hong Kong-listed company surged as much as 23% to HKD 2.90 after news broke of the potential plans. Razer IPO’d at HKD 3.88 per share in 2017.
In its 1H 2021 earnings, Razer reported record-high revenue of USD 752 million with 68% YoY growth.
Earlier this year, Min and Lim sold 275 million shares, or around 3.09% of the company, for “financial management purposes” at HKD 2.405 each – a 7.5% discount to where the stock was trading prior.
At Bread, we’ve been optimistic about Razer’s potential, with one author highlighting its growth potential.
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