Highpower International has entered into a definitive agreement and plan of merger under which HPJ Parent Limited will be acquired.

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Image: Highpower International going private. Photo: Courtesy of Felipe Wiecheteck/FreeImages.com

The company will be acquired by a consortium consisting of Dang Yu (George) Pan, the Company’s Chairman and Chief Executive Officer and a stockholder of the Company, Wen Liang Li, a director and stockholder of the Company, Wen Wei Ma, a stockholder of the Company, and Essence International Capital Limited, a company incorporated in Hong Kong, will acquire Highpower through a merger with a wholly-owned subsidiary of Parent (the “Merger”).

Subject to the terms and conditions of the Merger Agreement, at the effective time of the Merger, Highpower stockholders will be entitled to receive US$4.80 in cash for each share of Highpower common stock (collectively, “Shares”), except Shares held by the consortium that are contributed to Parent prior to the effective time and dissenting shares seeking appraisal rights. The merger consideration represents a premium of approximately 67% over the Company’s closing price of US$2.88 per share on June 1, 2018, the last trading day prior to the Company’s announcement of its receipt of a “going-private” proposal.  Parent intends to fund the Merger consideration with the proceeds from an equity investment of US$51,136,733 by Essence International Capital Limited (the “Sponsor”), pursuant to the terms of an equity commitment letter.

The Board of Directors of Highpower, acting on the recommendation of a special committee of independent and disinterested directors (the “Special Committee”), unanimously approved the Merger Agreement with directors Pan and Li abstaining.

The Merger, which is currently expected to close during the third quarter, is subject to various closing conditions, including the adoption of the Merger Agreement by Highpower’s stockholders and an affirmative vote of at least a majority of all outstanding Shares unaffiliated with the consortium. If completed, the Merger will result in the Company becoming a privately-held company, and its Shares will no longer be listed on the NASDAQ Global Market.

For further information regarding the terms and conditions contained in the Merger Agreement, please see Highpower’s Current Report on Form 8-K, which will be filed in connection with the proposed transaction.

As previously mentioned, Roth Capital Partners is serving as financial advisor to the Special Committee, and KattenMuchinRosenman LLP is serving as legal advisor to the Special Committee. Manatt, Phelps & Phillips, LLP is serving as legal advisor to the Company; Orrick, Herrington & Sutcliffe LLP is serving as legal advisor to the consortium; and O’Melveny & Myers LLP is serving as legal advisor to Essence.

Source: Company Press Release