BEIJING, Feb. 7, 2018 /PRNewswire/ -- NQ Mobile Inc., a
leading smart car and smart ride company, today released a letter
to shareholders from Dr. Vincent Wenyong
Shi, Chairman of the Board. The complete letter is
included below:
Dear Shareholders,
When I accepted the position of Chairman of the Board in 2014, I
was focusing on two priorities. The first was to make sure our
business was positioned for the future development, and second was
for our shareholders to recognize the value of what we had already
created. In order to seize the opportunities arising from the smart
car industry, and to position the company for that future
development, the company acquired a controlling stake of Linkmotion
Holdings Ltd., a smart car company in 2015. In addition, we
also unveiled the future roadmap of our rebranding business plan
around our new focus as a smart car and smart ride company in
January 22, 2018. To fulfill the
second objective, we set out on a path to divest and monetize many
of our existing smartphone related businesses that would not be a
part of our smart car related business focus in the future.
Looking back over this monetization effort, our goal was to sell
certain existing businesses for cash and for the underlying value
of our businesses to ultimately be unlocked and recognized by our
shareholders.
The divestment and sales process took much longer than
anticipated, for a variety of reasons that were outside of our
control. This extended length of time, combined with
the adjustments in ultimate divestment and sales path, has led
to shareholders' uncertainties and concerns during and subsequent
to the completion of the divestment and sales transaction. I'd
like to share some information related to this divestment and sales
transaction in order to clear up any lingering questions that our
shareholders may have.
First, I believe that all material aspects of the FL Mobile
divestment and the sale of Beijing Showself's live social
video businesses were publicly disclosed, including my
participation and role in the purchasing group. Any
related party elements pertaining to my involvement in the
purchasing group were considered by the Board's independent
directors and audit committee, who approved all relevant matters
with the support of professional appraiser. Second, Tongfang
Investment Fund Series SPC ("Tongfang") is an independent
third party that led the purchasing group, which I joined anew for
this specific transaction, to purchase from the Company certain
equity interests of FL Mobile and Beijing Showself. I have
been facilitating the transaction and acted as a trustee for our
Company when the purchasing group requested that the shares should
be registered under a new individual shareholder to satisfy
structural arrangements related to future capital market
requirements of the divested assets. The arrangements are made
to ensure the successful completion of the transaction. The
transaction completed on December 14,
2017, and the total consideration received by us as of
December 14, 2017 amounted to
approximately RMB3.32 billion in cash
and senior note from Tongfang. The
majority of the cash received has been in Chinese currency, which
factors into our overall cash and treasury functions especially as
it relates to foreign currency needs under the tight regulation of
the Chinese foreign exchange body.
While the prolonged process and complications associated with
the divestment and sales transaction left undesired uncertainties
and frustrations among the shareholders, I believe the outcome will
be undeniably positive for our future. The Company's cash,
cash equivalents, term deposits and restricted cash as of the last
reported results on September 30,
2017 totaled $248.8
million. Between September 30,
2017 and December 31, 2017,
the Company also received approximately $220
million more in cash from Tongfang. In addition, the Company
has a senior note from Tongfang worth approximately RMB1.77 billion that bears interest of 8% per
annum. Our cash and equivalents position has put NQ Mobile in a
strong position to address future smart car and smart ride business
opportunities.
An important part of our monetization plans contemplated
leveraging our cash balance position to achieve specific
shareholder friendly actions including buybacks. On
November 13, 2017, the board
authorized the Company to repurchase up to US$150 million of its shares or convertible notes
over the next 12 months and to date we have used $93 million. This included the early
redemption of $88 million of the
Company's outstanding convertible notes and about $5 million for the repurchase of ADSs on the open
market. The average price of the ADSs repurchased so far is
$3.95.
As we have completed our divestment and sales transaction, it is
important to focus on our new business and we are excited about our
future. The management team is moving forward swiftly and
expect to commercially launch our smart ride business in the
summer. This will include forming more partnerships that will
be important to the ecosystem around this unique passenger-centric
service. These partnerships will continue to validate the
opportunity and we look forward to sharing these with you in the
coming weeks and months ahead.
I am keenly aware of the past frustrations among
shareholders, but want you to know that our plans and goals were
specifically initiated to help us be poised for what we are doing
right now in our business plans. We must now deliver and execute on
these business objectives and earn the confidence of our
shareholders again. We will also continue to share our
progress with our shareholders and communicate with the market as
we deliver results.
On behalf of the Management Team, I wish to express appreciation
and gratitude for all of your support and patience. We are
well positioned for the future and are determined to enable our
shareholders to benefit from our businesses going forward.
With sincerity and determination,
Vincent
About NQ Mobile Inc.
NQ Mobile Inc. ("Link Motion" NYSE: NQ) is a leading smart
ride business. Link Motion's portfolio of offerings includes
enabling technology solutions and secure connected carputers for
the ecosystem of car businesses, consumer ride sharing services, as
well as legacy mobile security, productivity and other related
applications. For more information on Link Motion, please
visit http://www.lkmotion.com.
Forward Looking Statements
This news release contains "forward-looking statements" within
the meaning of Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of 1934, as
amended, and as defined in the U.S. Private Securities Litigation
Reform Act of 1995. These forward-looking statements can be
identified by terminology such as "will," "expects," "anticipates,"
"future," "intends," "plans," "believes," "estimates" and similar
statements. All statements other than statements of historical fact
in this press release are forward-looking statements and involve
certain risks and uncertainties that could cause actual results to
differ materially from those in the forward-looking statements.
These forward-looking statements are based on management's current
expectations, assumptions, estimates and projections about the
Company and the industry in which the Company operates, but involve
a number of unknown risks and uncertainties. Further information
regarding these and other risks is included in the Company's
filings with the U.S. Securities and Exchange Commission. The
Company undertakes no obligation to update forward-looking
statements to reflect subsequent occurring events or circumstances,
or changes in its expectations, except as may be required by law.
Although the Company believes that the expectations expressed in
these forward looking statements are reasonable, it cannot assure
you that such expectations will turn out to be correct, and actual
results may differ materially from the anticipated results. You are
urged to consider these factors carefully in evaluating the
forward-looking statements contained herein and are cautioned not
to place undue reliance on such forward-looking statements, which
are qualified in their entirety by these cautionary statements.
Investor Relations:
NQ Mobile Inc.
Email: investors@nq.com
Phone: +1 303 885 8688
Phone: +86 10 6452 2017
Twitter: @NQMobileIR
View original
content:http://www.prnewswire.com/news-releases/nq-mobile-inc-releases-a-letter-to-shareholders-from-the-chairman-of-the-board-300595039.html
SOURCE NQ Mobile Inc.