CCRC Stock Price Increases Over 10% Pre-Market: Why It Happened

By Amit Chowdhry ● Mar 12, 2021
  • The stock price of China Customer Relations Centers, Inc. (Nasdaq: CCRC) increased by over 10% during the pre-market. This is why it happened.

The stock price of China Customer Relations Centers, Inc. (Nasdaq: CCRC) – a leading e-commerce and financial services business process outsourcing service provider in China – increased by over 10% during the pre-market. Investors appear to be responding to China Customer Relations Centers entering into a definitive merger agreement and Plan of Merger with Taiying Group Ltd. and Taiying International, a wholly-owned subsidiary of Taiying Group.

Pursuant to the Merger Agreement, Taiying Group will acquire the company for a cash consideration equal to US$6.50 per share of the company. This amount represents a premium of 37.7% over the company’s closing price of US$4.72 per share on November 27, 2020, the last trading day prior to November 30, 2020, the date that the Company announced it had received a “going-private” proposal, and a premium of 37.8% to the volume-weighted average closing price of the company’s shares during the 60 trading days prior to November 30, 2020. And this amount also represents an increase of approximately 21% over the US$5.37 per Share initially offered by the buyer group in their initial “going-private” proposal on November 27, 2020.

Immediately after the merger, Taiying Group will be beneficially owned by a group of rollover shareholders, including Zhili Wang, the chief executive officer and chairman of the Board and director of China Customer Relations Centers; Debao Wang, the chief financial officer of China Customer Relations Centers; Guoan Xu, director and Vice President of China Customer Relations Centers; Qingmao Zhang, Long Lin, Jishan Sun, and certain other shareholders of the China Customer Relations Centers.

As of the date of the Merger Agreement, the Buyer Group beneficially owns, in the aggregate, approximately 71.1 % of the outstanding Shares of China Customer Relations Centers.

The merger is currently expected to close in the second quarter of 2021.

Taiying Group has entered into a debt commitment letter pursuant to which China Merchants Bank Co., Ltd. has agreed to provide a secured term facility for the merger, subject to certain conditions. 

Disclaimer: This content is intended for informational purposes. Before making any investment, you should do your own analysis.