Shanghai-based mail order and Internet retailer Mecox Lane has announced that Sina.com and China Dongxiang plan to purchase 117,505,755 ordinary shares from its two major shareholders, Maxpro Holdings Limited and Ever Keen Holdings Limited.
Under the reported share purchase agreement, Sina.com will buy 76,986,529 ordinary shares, which are about 19% of Mecox Lane's total issued shares; and China Dongxiang will buy 40,519,226 ordinary shares, about 10% of Mecox Lane's total issued shares. The acquisition price is USD0.8571 per ordinary share.
Maxpro Holdings Limited and Ever Keen Holdings Limited also agree to offer the options of buying additional 48,254,173 ordinary shares and 18,306,117 ordinary shares of Mecox Lane to Sina.com and China Dongxiang, respectively. The purchase options will be valid within the two years following the completion of the share purchase and the price will be USD1.1429 per ordinary share.
On the completion of the purchase, Sina.com and China Dongxiang will enter an one-year lock-up period. Meanwhile, the remaining Mecox Lane shares owned by Sequoia Capital, parent company of Maxpro Holdings Limited and Ever Keen Holdings Limited, will enter a 180-day lock up period.
With the completion of the transaction, Sina.com will assign a representative to join Mecox Lane.
Gu Beichun, director and CEO of Mecox Lane, said that the company plans to cooperate with Sina.com to explore the new online marketing model, and the two parties will form a partnership in the online advertising sector. They will also team with China Dongxiang to establish a sportswear sales channel on M18.com, Mecox Lane's Internet retail platform, and jointly develop new apparel products.