Smart Share Global (EM US): Hillhouse Crashes The Party. And Rightfully So

• Nearly seven months after receiving a preliminary non-binding proposal, Smart Share Global (EM US) announced on the 1st August a firm Offer had been entered into.

• The Offeror consortium, led by Mars Guangyuan Cai, Chairman and CEO, made an Offer of US$1.25/ADS, a 74.8% premium to last close; but ~20% below net cash + short-term investments.

• Now Hillhouse has thrown its hat into the ring with a US$1.77/ADS NBIO. Smart Share's special committee of independent directors should engage.

Smart Share is an illiquid stock. If that's not your bag, look away now.

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Conclusions First

• Interesting development - I'm curious why we don't see more of this type of action for low-balled US-listed PRC play privatisations.

• Smart Share should engage.

• Hillhouse have the clout. I don't see updated numbers, but AUM was >US$27.5bn as per this Reuters article in April last year.

  • Hillhouse was founded by Henan-born Lei Zhang in 2005.

• Hillhouse's indicative Offer is contingent on the same management buyer group with ~64% rolling over shares.

• As Hillhouse's transaction requires a two-thirds vote, this management team needs to be supportive of Hillhouse's Offer, or there is no deal.

  • Management + Hillhouse's stake (5.3% of the votes, if unchanged from Dec-24) clear this voting threshold.