In a letter to shareholders of Chinese wireless value-added services firm Hurray, Best Prospect Overseas Limited has stated that Hurray's management and board "seems to believe that they do not need to answer, or even listen, to Hurray!'s shareholders".
Best Prospect is trying to buy a 51% stake in the beleaguered WVAS firm, and in its letter to Hurray shareholders this week, Best Prospect states, "During the course of our attempt to bring leadership and opportunities to the company, we received numerous correspondences from shareholders ranging from large institutions with substantial shareholdings to individual shareholders, all in support of our efforts and all are frustrated with the status quo at Hurray!. We have been told that Hurray!'s shareholders are eager for change. We believe that there are many other shareholders who are also frustrated but have not expressed such frustration publicly."
Why is Hurray maybe not responding to Best Prospect? According to several insiders from the Chinese investment industry quoted by local Chinese media, Chinese online game company Shanda is discussing an acquisition deal Hurray. The negotiation between Shanda and Hurray reportedly started from April 23 and Shanda has reportedly inked a one-month confidential negotiation agreement with Hurray. Shanda apparently talked with Hurray about acquisition two years ago, but Tang Jun, former president of Shanda, did not agree with the acquisition and his reason was that the business qualifications of Hurray was not good at that time.
So far, Shanda said it has no comment on this acquisition rumor.
For the last quarter of 2008, Hurray's total revenues hit USD14.4 million, representing an increase of 6.7% quarter-over-quarter and a decrease of 9.2% year-over-year. Of that total, WVAS revenues were USD11.5 million, representing an increase of 3.8% quarter-over-quarter and an increase of 4.2% year-over-year. Recorded music revenues were USD3.0 million, representing an increase of 19.2% quarter-over-quarter and a decline of 39.3% year-over-year. Net loss was USD9.2 million. For the entire 2008 fiscal year, the news was not any better. Total revenues for the year were USD54.0 million, a decline of 10.9% as compared to USD60.5 million for 2007. WVAS revenues totaled USD42.7 million, a decline of 14.7 % as compared to USD50 million for 2007. However net loss for the entire year only hit USD12.0 million, compared to net loss of USD42.0 million for 2007.