SINA and DongXiang Enter Into Agreements to Acquire Shares of Mecox Lane and Memorandums of Understanding for Strategic Cooperation
SHANGHAI, March 1, 2011 /PRNewswire-Asia/ -- Mecox Lane Limited ("Mecox Lane" or the "Company") (NASDAQ: MCOX), which operates one of China's leading online platforms for apparel and accessories, today announced that SINA Corporation ("SINA") (NASDAQ: SINA) and a subsidiary of China Dongxiang (Group) Co., Ltd. ("DongXiang") (HKG 3818) entered into separate agreements to acquire an aggregate of 117,505,755 ordinary shares (equivalent to 16,786,535 ADSs) of Mecox Lane from two major shareholders of Mecox Lane, Maxpro Holdings Limited and Ever Keen Holdings Limited, both wholly owned by Sequoia Capital (collectively "Sequoia"). Each of Mecox Lane's ADSs trading on the Nasdaq Global Market represents seven ordinary shares.
Under the share purchase agreements, SINA will purchase 76,986,529 ordinary shares (equivalent to 10,998,075 ADSs), or approximately 19% of the issued and outstanding shares of Mecox Lane, and DongXiang will purchase 40,519,225 ordinary shares (equivalent to 5,788,460 ADSs), or approximately 10% of the issued and outstanding shares of Mecox Lane (collectively, the "Sale Shares"). The purchase price is US$0.8571 per share, equivalent to US$6.00 per ADS. The selling shareholders also agreed to grant SINA and DongXiang options to purchase 48,254,173 ordinary shares (equivalent to 6,893,453 ADSs) and 18,306,117 ordinary shares (equivalent to 2,615,159 ADSs) of Mecox Lane, respectively. The options are exercisable during a two-year period starting from the closing date of the above share purchases and the exercise price is US$1.1429 per ordinary share, equivalent to US$8.00 per ADS.
Upon the closing of share purchases, a representative from SINA will be appointed as a director of Mecox Lane and Mr. Kelvin Yu, a vice president with Sequoia will resign from the board. Each of SINA and DongXiang will be subject to a one-year lock-up with respect to the Sale Shares, starting from the closing date of the share purchases. Sequoia will also be subject to 180-day lock-ups starting from the closing date of the share purchases, for their respective remaining shares in Mecox Lane.
"We believe that the strategic partnerships with SINA and DongXiang will help expedite the pace for us to become a leading online fashion shopping mall in China," said Mr. Alfred Gu, Mecox Lane's Director and Chief Executive Officer. "We plan to work with SINA to explore new forms of online marketing and treat each other as most-favored business partner in the cooperation of online advertising products and services. We and DongXiang intend to work together to launch the online platform sub-channel created solely for sportswear in m18.com as well as to develop a new line of basic style apparel and accessories," added Mr. Gu.
"We are very pleased that SINA and Dongxiang become strategic shareholders of the company and would continue to support management in executing their business plan and strategies," commented Neil Shen, Chairman of the Board of Directors of Mecox Lane and Managing Partner of Sequoia Capital China.
"We are excited to enter China's e-commerce space starting with our investment in Mecox Lane," stated Charles Chao, Chief Executive Officer of SINA. "We believe our strategic investment in Mecox Lane will enhance the Company's online marketing capability and strengthen the Company's ecommerce platform for apparel and accessories."
"DongXiang is very glad to sign this transaction," commented Mr. Chen Yihong, Chairman of DongXiang. "DongXiang's highly recognized brands in sportswear sector and Mecox Lane's 'plug-and-play' online platform will create a solid foundation for us to tap into the growing online sportswear market in China. We believe both DongXiang and Mecox will benefit from increased collaboration, cooperation and interaction in our business activities."
About Mecox Lane Limited
Mecox Lane Limited (NASDAQ: MCOX) operates China's leading online platform for apparel and accessories as measured by revenues in 2009. The Company offers a wide selection of fashion products through its www.m18.com e-commerce website and physical store network. Product offerings include apparel and accessories, home products, beauty and healthcare products and other products, under the Company's own proprietary brands, such as Euromoda and Rampage, as well as under selected third-party brands, including established international and Chinese brands in addition to independent and emerging brands. For more information on Mecox Lane, please visit http://ir.m18.com.
SINA Corporation (Nasdaq GS: SINA) is a leading online media company and mobile value-added service provider for China and for the global Chinese communities. With a branded network of localized websites targeting Greater China and overseas Chinese, the Company provides services through five major business lines including SINA.com (online news and content), SINA Mobile (MVAS), SINA Community (Web 2.0-based services and games), SINA.net (search and enterprise services) and SINA E-Commerce (online shopping). Together these business lines provide an array of services, including region-focused online portals, MVAS, social networking service (SNS), blog, audio and video streaming, album, online games, email, search, classified listings, fee-based services, e-commerce and enterprise e-solutions. The Company generates the majority of its revenues from online advertising and MVAS offerings, and, to a lesser extent, from search and other fee-based services.
About China Dongxiang (Group) Co., Ltd.
China Dongxiang (Group) Co., Ltd. is a leading international sportswear brand enterprise based in China and was successfully listed on the Stock Exchange of Hong Kong Limited on 10 October 2007. The Group is primarily engaged in the design, development, marketing and wholesale of branded sportswear in China. Currently, China Dongxiang owns all rights to the internationally recognized Kappa and Robe Di Kappa Brand in China, Macau and Japan. Its products convey an active, fashionable and youthful image and are warmly welcomed by China's fast growing and high potential consumers. The Group completed the acquisition of a Japan sportswear enterprise Phenix on 1 May 2008. Phenix, the most popular ski brand in Japan with the largest market share, has gained strong recognition in the international market.
Safe Harbor: Forward Looking Statements
This press release contains forward-looking statements made under the "safe harbor" provisions of Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements can be identified by terminology such as "may", "will," "expects," "anticipates," "future," "intends," "plans," "believes," "aims", "estimates," "confident", "likely to" and similar statements. Among other things, the quotations from management in this press release, as well as the Company's strategic and operational plans, contain forward-looking statements. Forward-looking statements involve inherent risks and uncertainties. A number of factors could cause actual results to differ materially from those contained in any forward-looking statement, including but not limited to the following: the Company's business strategies and initiatives as well as its business plans; the Company's future business development, results of operations and financial condition; changes in the Company's revenues and certain cost or expense items; the Company's expectations with respect to increased revenue growth and its ability to sustain profitability; the Company's products under development or planning; the Company's ability to attract customers and further enhance its brand recognition; trends and competition in the e-commerce and apparel and accessories industry; the e-commerce and apparel and accessories industry in China may not grow at the rates projected by market data, or at all; the failure of the markets to grow at the projected rates may have a material adverse effect on the Company's business and the market price of its ADSs; in addition, the rapidly changing nature of the e-commerce and apparel and accessories industry in China subjects any projections or estimates relating to the growth prospects or future condition of the Company's market to significant uncertainties. If any one or more of the assumptions underlying the market data turns out to be incorrect, actual results may differ from the projections based on these assumptions. You should not place undue reliance on these forward-looking statements. Further information regarding these and other risks is included in the Company's registration statement on Form F-1 filed with the Securities and Exchange Commission. All information provided in this press release is current as of the date of the press release, and the Company undertakes no duty to update such information, except as required under applicable law.
For investor and media inquiries please contact:
Mecox Lane Limited
Tel: +86-21-6495-0500 or +86-21-5464-9900 Ext. 8161
Ogilvy Financial, Beijing
In the U.S.:
Jessica Barist Cohen
Ogilvy Financial, New York
SOURCE SINA Corporation