Home Inns & Hotels Management Inc. has entered into a definitive purchase agreement to issue USD50 million in equity, or 7,514,503 ordinary shares, to Ctrip.com International Ltd. through a private placement.
The purchase price per ordinary share is set at USD6.6538, or USD13.3076 per American depository share, calculated as the average of the closing prices for the Home Inns' American depository shares on NASDAQ for each trading day within the 30 calendar days preceding the agreement date, which is from and including April 7, 2009 up to and including May 6, 2009.
Upon the completion of the transaction, Ctrip's ownership in Home Inns will be increased by 9.52% to a total of 18.25% of the company's aggregate basic shares outstanding. Prior to the transaction, Ctrip held 3,443,131 American depository shares, representing 6,886,262 ordinary shares of Home Inns.
The transaction is expected to close on or before May 21, 2009. Home Inns will receive USD20 million at closing and the remaining USD30 million within 30 days after closing. The funds will be used for general corporate purposes.