The private investor consortium buying online recruitment firm 51job is lowering its takeover bid by around 28%, as stricter regulation continues to affect the country’s technology sector, reports Bloomberg. The group backed by DCP Capital Partners has proposed to lower its offer to $57.25 per share in cash, down from an agreed bid of $79.05 per share. The new price represents a 25% premium to 51job’s last close in New York.
Bloomberg News reported earlier that 51job was considering reducing its $5.7 billion offer to reflect changes in the market environment. The buyer group, which also includes Ocean Link Partners and 51job Chief Executive Officer Rick Yan, said it’s restructuring the bid to reflect tighter Chinese regulatory policies that are expected to hit the job market, as well as persistent economic challenges from Covid-19.
The proposed changes will also help ensure the deal complies with new Chinese rules on data security, it said. The combined foreign ownership of DCP Capital and Ocean Link in 51job after the takeover will be capped at 9.99%, and the consortium believes the revised deal won’t trigger any regulatory filing in China, it said in the statement.