Razer Shares Drop After Group Offers to Take the Company Private

Shares of Singaporean-American multinational technology company Razer saw its shares drop this week after a group offered to take the company private.

The group included the company’s own co-founder, Min-Liang, as well as private equity firm CVC Capital Partners. It has made an offer to take the Hong Kong-listed gaming hardware company private and pay up to 10.79 billion Hong Kong dollars ($1.38 billion) to buy all remaining shares, according to a regulatory filing.

As part of the deal, the consortium plans to buy those shares at 2.82 Hong Kong dollars a piece, representing a 5.6% upside based on Razer’s closing price Wednesday.

The group led by Chairman Min-Liang Tan and non-executive director Kaling Lim, who own around 57% of Razer, are offering HK$2.82 a share for the remainder of the company and the offer is final, Razer said.

The company said the offer price is final and will not be increased.

Razer went public in 2017 with an initial public offering price of 3.88 Hong Kong dollars a share.

Headquartered in Irvine, California, the company makes laptops, PC peripherals and other products for gamers. It also has regional headquarters in Shanghai, Singapore and Hamburg, Germany.

Credit Suisse is the financial advisor on the proposed deal while Razer’s board will appoint an independent adviser to assess the buyout proposal, the filing said.

According to David Blennerhassett, an analyst at Ballingal Investment Advisors, the offer price is fair based on an average premium of 34.6% to the last closing price of Hong Kong-listed companies offered so far this year.

Disclaimer: We have no position in any of the companies mentioned and have not been compensated for this article.