The9 Limited (NCTY) has signed a term sheet to purchase the 31.1% minority interest in China The9 Interactive Limited currently held by a joint venture partner, China Interactive (Singapore) Pte. Limited.
China The9 Interactive Limited (C9I) holds an exclusive license from Vivendi Universal Games Inc. to operate World of Warcraft (WoW) in mainland China.
Zhu Jun, The9's Chairman and CEO, commented: "Upon acquisition of the minority interest, The9 will be the sole shareholder of C9I, with financial returns from our operation of WoW in mainland China accruing to the exclusive
benefit of The9 and our shareholders. We have full confidence in the future returns on our investment in C9I."
The9 currently owns 68.9% of C9I via its wholly owned subsidiary, GameNow.net (Hong Kong) Limited. GameNow has agreed to purchase the 31.1% minority interest from China Interactive for a purchase price to be paid in cash, partially offset by the US$10.6 million loans previously extended by GameNow to China Interactive, plus all unpaid interest accrued thereon up to the signing date of the definitive share purchase agreement.
GameNow has agreed to pay the purchase price in several installments, the last of which is expected to be paid in the first half of 2006.
The principal terms of GameNow's loans to China Interactive were disclosed in The9's previous SEC filings.