Chinese e-commerce group Alibaba revealed that the company has provided a non-binding proposal letter to AutoNavi, aiming to make it a wholly-owned subsidiary of Alibaba for USD1.1 billion.
Alibaba offers to acquire all of AutoNavi's American depositary shares and ordinary shares not already beneficially owned by Alibaba for USD21 in cash per American depositary share, each representing four ordinary shares. Alibaba currently has approximately 28% of the AutoNavi's total issued and outstanding shares. If the deal is closed, AutoNavi will become a wholly-owned subsidiary of Alibaba Group.
AutoNavi said that its board of directors had received the proposal and plans to establish an independent committee to evaluate this proposal.
In regards to the goal of this acquisition, Alibaba said that it will help improve the competitiveness of AutoNavi's map and navigation businesses, so as to further improve its customer service capacity in these sectors.
In May 2013, AutoNavi announced that the company gained USD294 million strategic investment from Alibaba. So far, the two parties have implemented cooperation in geographic data, map engine, product development, and commercialization.