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Chinese Internet company Sina Corp Thursday said it was open to discussions with Shanda Interactive Entertainment on its attempt to take over the firm, but insisted that there should be no change in the company's management.
Shanghai-based Shanda announced on Saturday that it had acquired about 19.5 percent of Sina's stocks from open market purchases by February 10 and would seek a business combination with Sina.
Both companies are NASDAQ-listed, with Shanda being the biggest Chinese online game operator and Sina being the leading Internet portal and possibly the most influential Internet company in the country.
Sina responded with a statement on the same day that its board, management, and business will not change, in spite of the acquisition.
It then announced a "poison pill" scheme on Wednesday to allow investors to buy its stocks at half price, if anyone tries to get over 10 percent of Sina's ordinary shares or Shanda boosts its stakes to 20 percent.
Sina spokeswoman Shen Jianming said yesterday that her company is open to any strategic investors, but it must be done through open discussions.
She said Sina would like to talk with Shanda, but Shanda did not raise any formal proposals.
Li Lijun, a spokeswoman of Shanda, also said that she had no knowledge that the company had put forward a proposal. However, she said there will be more developments in the coming days.
Sina's responses were made when Sina's major shareholder Stone Group Holdings Ltd issued a statement on the Hong Kong Stock Exchange that it would sell its 4.96 percent stake in Sina at an appropriate time.
Stone Chairman Duan Yongji is also a co-chairman of Sina.
It was reported that Shanda Chairman and CEO Chen Tianqiao met Duan on Tuesday.
The Sina spokeswoman declined to comment on Duan's move.
She said that only a shareholder with over 50 percent of stakes can naturally become a director according to the Cayman Islands' law, where Sina is incorporated, so Shanda will not necessarily gain a seat on the Sina board.
She added Sina hoped its existing businesses and management team will not be subject to any change.
Lu Weigang, an Internet industry analyst in Beijing, said he believed the "poison pill" scheme and Sina's move might be signs that Sina's board tried to bring Shanda to talks and increase its bargaining power.
(China Daily February 25, 2005)
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