|
China Index Holdings Limited
Tower A, No. 20 Guogongzhuang Middle Street Fengtai District, Beijing 100070 The People’s Republic of China Attention: Lili Chen Tel: +86-10-5631-9106 |
| |
Fang Holdings Limited
c/o Tower A, No. 20 Guogongzhuang Middle Street Fengtai District, Beijing 100070 The People’s Republic of China Attention: Jiangong Dai Tel: +86-10-5631-8010 |
| |
Jiangong Dai
True Knight Limited c/o Tower A, No. 20 Guogongzhuang Middle Street Fengtai District, Beijing 100070 The People’s Republic of China Attention: Jiangong Dai Tel: +86-10-5631-8268 |
|
|
Tianquan Mo
ACE Smart Investments Limited Karistone Limited Open Land Holdings Limited Media Partner Technology Limited Next Decade Investments Limited c/o Tower A, No. 20 Guogongzhuang Middle Street Fengtai District, Beijing 100070 The People’s Republic of China Attention: Tianquan Mo Tel: +86-10-5631-8661 |
| |
Shan Li
Digital Link Investments Limited Unit 219, 2/F Building 16W, Phase Three Hong Kong Science Park, Pak Shek Kok New Territories, Hong Kong SAR Attention: Shan Li Tel: +852-3500-6800 |
| |
General Atlantic Singapore
Fund Pte. Ltd. 8 Marina View, #41-04, Asia Square Tower 1, Singapore 018960 Tel: +65-6661-6700 |
|
|
GAP Coinvestments CDA, L.P.
GAP Coinvestments V, LLC GAP Coinvestments IV, LLC GAP Coinvestments III, LLC General Atlantic, L.P. General Atlantic Singapore Interholdco Ltd. c/o General Atlantic Service Company, L.P., 55 East 52nd Street, 33rd Floor, New York, NY 10055 Tel: +1-212-715-4000 |
| |
GAP (Bermuda) L.P.
General Atlantic GenPar (Bermuda), L.P. General Atlantic Partners (Bermuda) IV, L.P. General Atlantic Partners (Bermuda) III, L.P. Clarendon House, 2 Church Street, Hamilton HM 11, Bermuda Tel: +1-441-295-1422 |
| |
Evenstar Master Fund SPC for and
on behalf of Evenstar Master Sub-Fund I Segregated Portfolio Evenstar Special Situations Limited Evenstar Capital Management Limited P.O. Box 309, Ugland House South Church Street George Town, KY1-1104 Cayman Islands Attention: The Directors of the Fund Tel: +852-2122-8882 |
|
|
Fang Xue, Esq.
Gibson, Dunn & Crutcher LLP Unit 1301, Tower 1, China Central Place No. 81 Jianguo Road Chaoyang District Beijing 100025 People’s Republic of China +86-10-6502-8500 |
| |
Alan Bao, Esq.
O’Melveny & Myers LLP Yin Tai Centre, Office Tower, 37th Floor No. 2 Jianguomenwai Ave. Chao Yang District Beijing 100022 People’s Republic of China +86-10-6563-4253 |
| |
Judie Ng Shortell
Paul, Weiss, Rifkind, Wharton & Garrison LLP 1285 Avenue of the Americas New York, New York 10019 +1-212-373-3434 |
|
|
Qi Yue, Esq.
Gibson, Dunn & Crutcher 32/F Gloucester Tower, The Landmark 15 Queen’s Road Central, Hong Kong +852-2214-3700 |
| | | | |
Xiaoxi Lin
Linklaters LLP 11/F Alexandra House Charter Road Hong Kong +852-2901-5368 |
|
| INTRODUCTION | | | | | 1 | | |
| | | | | 2 | | | |
| | | | | 26 | | | |
| | | | | 29 | | | |
| | | | | 76 | | | |
| | | | | 77 | | | |
| | | | | 85 | | | |
| | | | | 87 | | | |
| | | | | 89 | | | |
| | | | | 90 | | | |
| | | | | 91 | | | |
| | | | | 91 | | | |
| | | | | 91 | | | |
| | | | | 91 | | | |
| | | | | 92 | | | |
| | | | | 93 | | | |
| | | | | 94 | | | |
| | | | | 94 | | | |
| | | | | 96 | | | |
| | | | | 97 | | | |
| | | | | 97 | | | |
| | | | | 98 | | | |
| | | | | 98 | | | |
| | | | | 98 | | | |
| | | | | 99 | | | |
| | | | | 99 | | | |
| | | | | 99 | | | |
| | | | | 109 | | |
Management Projections
|
| |
2022Q3
|
| |
2022Q4
|
| |
2023Q1
|
| |
2023Q2
|
| |
2023Q3
|
| |
2023Q4
|
| |
2024Q1
|
| |||||||||||||||||||||
| | |
(Amounts in RMB, except for percentages)
|
| |||||||||||||||||||||||||||||||||||||||
Revenues
|
| | | | 97,669,340 | | | | | | 104,269,727 | | | | | | 82,955,149 | | | | | | 88,175,133 | | | | | | 87,902,406 | | | | | | 93,842,754 | | | | | | 74,659,634 | | |
Cost of revenues
|
| | | | -19,734,987 | | | | | | -27,745,752 | | | | | | -15,213,112 | | | | | | -15,600,670 | | | | | | -17,761,488 | | | | | | -24,971,177 | | | | | | -13,691,801 | | |
Gross Profit
|
| | | | 77,934,353 | | | | | | 76,523,974 | | | | | | 67,742,037 | | | | | | 72,574,463 | | | | | | 70,140,918 | | | | | | 68,871,577 | | | | | | 60,967,833 | | |
Selling and marketing expenses
|
| | | | -22,096,970 | | | | | | -22,991,900 | | | | | | -22,080,600 | | | | | | -26,430,051 | | | | | | -22,096,970 | | | | | | -22,991,900 | | | | | | -19,872,540 | | |
General and administrative expenses
|
| | | | -16,868,387 | | | | | | -19,988,300 | | | | | | -17,593,696 | | | | | | -9,652,549 | | | | | | -16,868,387 | | | | | | -19,988,300 | | | | | | -15,834,326 | | |
Research and
development expenses |
| | | | -7,912,585 | | | | | | -6,874,700 | | | | | | -6,619,906 | | | | | | -5,058,740 | | | | | | -7,912,585 | | | | | | -6,874,700 | | | | | | -5,957,915 | | |
Operating expenses
|
| | | | -46,877,942 | | | | | | -49,854,900 | | | | | | -46,294,202 | | | | | | -41,141,339 | | | | | | -46,877,942 | | | | | | -49,854,900 | | | | | | -41,664,782 | | |
Operating Income
|
| | | | 31,056,411 | | | | | | 26,669,074 | | | | | | 21,447,835 | | | | | | 31,433,124 | | | | | | 23,262,976 | | | | | | 19,016,677 | | | | | | 19,303,051 | | |
Interest income
|
| | | | 2,091,342 | | | | | | 992,124 | | | | | | 2,091,342 | | | | | | 992,124 | | | | | | 2,091,342 | | | | | | 992,124 | | | | | | 2,091,342 | | |
Change in fair value of the warrant
|
| | | | -2,450,183 | | | | | | — | | | | | | — | | | | | | — | | | | | | -2,450,183 | | | | | | — | | | | | | — | | |
Gains on sales of available for sale investments
|
| | | | -3,525 | | | | | | 340,160 | | | | | | -3,525 | | | | | | 340,160 | | | | | | -3,525 | | | | | | 340,160 | | | | | | -3,525 | | |
Government grants
|
| | | | 363,451 | | | | | | 13,220 | | | | | | 363,451 | | | | | | 363,451 | | | | | | 363,451 | | | | | | 13,220 | | | | | | 363,451 | | |
Income before income taxes
|
| | | | 31,057,496 | | | | | | 28,014,578 | | | | | | 23,899,103 | | | | | | 33,128,859 | | | | | | 23,264,061 | | | | | | 20,362,181 | | | | | | 21,754,319 | | |
Income tax expense
|
| | | | -3,287,659 | | | | | | -3,182,485 | | | | | | -3,416,997.80 | | | | | | -4,736,631.25 | | | | | | -3,326,202.03 | | | | | | -2,911,302.85 | | | | | | -3,110,345.27 | | |
Net income
|
| | | | 27,769,837 | | | | | | 24,832,093 | | | | | | 20,482,105 | | | | | | 28,392,227 | | | | | | 19,937,859 | | | | | | 17,450,878 | | | | | | 18,643,974 | | |
Gross margin
|
| | | | 79.79% | | | | | | 73.39% | | | | | | 81.66% | | | | | | 82.31% | | | | | | 79.79% | | | | | | 73.39% | | | | | | 81.66% | | |
Operating margin
|
| | | | 31.80% | | | | | | 25.58% | | | | | | 25.85% | | | | | | 35.65% | | | | | | 26.46% | | | | | | 20.26% | | | | | | 25.85% | | |
Net profit
|
| | | | 28.43% | | | | | | 23.82% | | | | | | 24.69% | | | | | | 32.20% | | | | | | 22.68% | | | | | | 18.60% | | | | | | 24.97% | | |
ETR
|
| | | | 10.59% | | | | | | 11.36% | | | | | | 14.30% | | | | | | 14.30% | | | | | | 14.30% | | | | | | 14.30% | | | | | | 14.30% | | |
Management
Projections (Continued) |
| |
2024Q2
|
| |
2024Q3
|
| |
2024Q4
|
| |
2025Q1
|
| |
2025Q2
|
| |
2025Q3
|
| |
2025Q4
|
| |||||||||||||||||||||
| | |
(Amounts in RMB, except for percentages)
|
| |||||||||||||||||||||||||||||||||||||||
Revenues
|
| | | | 70,540,106 | | | | | | 79,112,165 | | | | | | 84,458,479 | | | | | | 59,727,707 | | | | | | 63,486,096 | | | | | | 71,200,949 | | | | | | 76,012,631 | | |
Cost of revenues
|
| | | | -12,480,536 | | | | | | -15,985,339 | | | | | | -22,474,059 | | | | | | -10,953,441 | | | | | | -11,232,482 | | | | | | -14,386,806 | | | | | | -20,226,653 | | |
Gross Profit
|
| | | | 58,059,571 | | | | | | 63,126,826 | | | | | | 61,984,419 | | | | | | 48,774,266 | | | | | | 52,253,614 | | | | | | 56,814,143 | | | | | | 55,785,977 | | |
Selling and marketing expenses
|
| | | | -23,787,046 | | | | | | -19,887,273 | | | | | | -20,692,710 | | | | | | -17,885,286 | | | | | | -21,408,341 | | | | | | -17,898,546 | | | | | | -18,623,439 | | |
General and administrative expenses
|
| | | | -8,687,294 | | | | | | -15,181,548 | | | | | | -17,989,470 | | | | | | -14,250,894 | | | | | | -7,818,564 | | | | | | -13,663,393 | | | | | | -16,190,523 | | |
Research and development expenses
|
| | | | -4,552,866 | | | | | | -7,121,327 | | | | | | -6,187,230 | | | | | | -5,362,124 | | | | | | -4,097,579 | | | | | | -6,409,194 | | | | | | -5,568,507 | | |
Operating expenses
|
| | | | -37,027,205 | | | | | | -42,190,148 | | | | | | -44,869,410 | | | | | | -37,498,303 | | | | | | -33,324,485 | | | | | | -37,971,133 | | | | | | -40,382,469 | | |
Operating Income
|
| | | | 21,032,365 | | | | | | 20,936,678 | | | | | | 17,115,009 | | | | | | 11,275,963 | | | | | | 18,929,129 | | | | | | 18,843,010 | | | | | | 15,403,508 | | |
Interest income
|
| | | | 992,124 | | | | | | 2,091,342 | | | | | | 992,124 | | | | | | 2,091,342 | | | | | | 992,124 | | | | | | 2,091,342 | | | | | | 992,124 | | |
Change in fair value of the warrant
|
| | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 0 | | | | | | 0 | | |
Gains on sales of
available for sale investments |
| | | | 340,160 | | | | | | -3,525 | | | | | | 340,160 | | | | | | -3,525 | | | | | | 340,160 | | | | | | -3,525 | | | | | | 340,160 | | |
Government grants
|
| | | | 363,451 | | | | | | 363,451 | | | | | | 13,220 | | | | | | 363,451 | | | | | | 363,451 | | | | | | 363,451 | | | | | | 13,220 | | |
Income before income taxes
|
| | | | 22,728,100 | | | | | | 23,387,946 | | | | | | 18,460,513 | | | | | | 13,727,231 | | | | | | 20,624,863 | | | | | | 21,294,278 | | | | | | 16,749,012 | | |
Income tax expense
|
| | | | -3,249,572.50 | | | | | | -3,343,914.67 | | | | | | -2,639,410.03 | | | | | | -1,962,664.38 | | | | | | -2,948,860.18 | | | | | | -3,044,570.45 | | | | | | -2,394,706.50 | | |
Net income
|
| | | | 19,478,527 | | | | | | 20,044,031 | | | | | | 15,821,103 | | | | | | 11,764,567 | | | | | | 17,676,003 | | | | | | 18,249,708 | | | | | | 14,354,305 | | |
Gross margin
|
| | | | 82.31% | | | | | | 79.79% | | | | | | 73.39% | | | | | | 81.66% | | | | | | 82.31% | | | | | | 79.79% | | | | | | 73.39% | | |
Operating margin
|
| | | | 29.82% | | | | | | 26.46% | | | | | | 20.26% | | | | | | 18.88% | | | | | | 29.82% | | | | | | 26.46% | | | | | | 20.26% | | |
Net profit
|
| | | | 27.61% | | | | | | 25.34% | | | | | | 18.73% | | | | | | 19.70% | | | | | | 27.84% | | | | | | 25.63% | | | | | | 18.88% | | |
ETR
|
| | | | 14.30% | | | | | | 14.30% | | | | | | 14.30% | | | | | | 14.30% | | | | | | 14.30% | | | | | | 14.30% | | | | | | 14.30% | | |
Company
|
| |
Ticker
|
|
Leju Holdings Limited
|
| | LEJU | |
Urbanimmersive Inc.
|
| | TSXV:UI | |
P.E. Analytics Limited
|
| | PROPEQUITY | |
e-Seikatsu Co., Ltd.
|
| | 3796 | |
Property Data Bank
|
| | 4389 | |
Doma Holdings Inc.
|
| | DOMA | |
Voxtur Analytics Corp.
|
| | VXTR | |
Douglas Elliman Inc.
|
| | DOUG | |
Fang Holdings Limited
|
| | SFUN.Y | |
E-House Enterprise
|
| | 2048 | |
Compass, Inc.
|
| | COMP | |
Redfin Corporation
|
| | RDFN | |
Anywhere Real Estate
|
| | HOUS | |
Zillow Group, Inc.
|
| | ZG | |
|
Leju Holdings Limited
|
| | LEJU | |
|
Urbanimmersive Inc.
|
| | TSXV:UI | |
|
e-Seikatsu Co., Ltd.
|
| | 3796 | |
|
Property Data Bank
|
| | 4389 | |
|
Voxtur Analytics Corp.
|
| | VXTR | |
|
E-House Enterprise
|
| | 2048 | |
|
Redfin Corporation
|
| | RDFN | |
|
Anywhere Real Estate
|
| | HOUS | |
|
Zillow Group, Inc.
|
| | ZG | |
| | |
Ownership Prior to the Merger(1)
|
| |
Ownership After the Merger(2)
|
| ||||||||||||||||||||||||||||||||||||||||||
Name
|
| |
Net Book Value
|
| |
Net Income
attributable to the Company |
| |
Net Book Value
|
| |
Net Income
attributable to the Company |
| ||||||||||||||||||||||||||||||||||||
| | |
RMB’000
|
| |
%
|
| |
RMB’000
|
| |
%
|
| |
RMB’000
|
| |
%
|
| |
RMB’000
|
| |
%
|
| ||||||||||||||||||||||||
Fang Holdings
|
| | | | 24,000 | | | | | | 19.7 | | | | | | 5,428 | | | | | | 19.7 | | | | | | 43,685 | | | | | | 35.8 | | | | | | 9,879 | | | | | | 35.8 | | |
ACE Smart
|
| | | | 15,488 | | | | | | 12.7 | | | | | | 3,502 | | | | | | 12.7 | | | | | | 15,488 | | | | | | 12.7 | | | | | | 3,502 | | | | | | 12.7 | | |
Karistone
|
| | | | 1,230 | | | | | | 1.0 | | | | | | 278 | | | | | | 1.0 | | | | | | 1,230 | | | | | | 1.0 | | | | | | 278 | | | | | | 1.0 | | |
Open Land
|
| | | | 33 | | | | | | * | | | | | | 8 | | | | | | * | | | | | | 33 | | | | | | * | | | | | | 8 | | | | | | * | | |
Media Partner
|
| | | | 7,936 | | | | | | 6.5 | | | | | | 1,795 | | | | | | 6.5 | | | | | | 7,936 | | | | | | 6.5 | | | | | | 1,795 | | | | | | 6.5 | | |
Next Decade
|
| | | | 7,954 | | | | | | 6.5 | | | | | | 1,799 | | | | | | 6.5 | | | | | | 7,954 | | | | | | 6.5 | | | | | | 1,799 | | | | | | 6.5 | | |
True Knight
|
| | | | 11,681 | | | | | | 9.6 | | | | | | 2,641 | | | | | | 9.6 | | | | | | 11,681 | | | | | | 9.6 | | | | | | 2,641 | | | | | | 9.6 | | |
Digital Link
|
| | | | 4,165 | | | | | | 3.4 | | | | | | 942 | | | | | | 3.4 | | | | | | 4,165 | | | | | | 3.4 | | | | | | 942 | | | | | | 3.4 | | |
General Atlantic
|
| | | | 13,435 | | | | | | 11.0 | | | | | | 3,038 | | | | | | 11.0 | | | | | | 13,435 | | | | | | 11.0 | | | | | | 3,038 | | | | | | 11.0 | | |
Evenstar
|
| | | | 14,893 | | | | | | 12.2 | | | | | | 3,368 | | | | | | 12.2 | | | | | | 14,893 | | | | | | 12.2 | | | | | | 3,368 | | | | | | 12.2 | | |
Parent
|
| | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 122,051 | | | | | | 100.0 | | | | | | 27,601 | | | | | | 100.0 | | |
| | |
Shares
|
| |
Company Options
|
| |
Company Restricted Shares
|
| | | | | | | |||||||||||||||||||||||||||||||||||||||||||||
| | |
Number of
Class A Ordinary Shares |
| |
Cash
Payment (US$) |
| |
Number of
Class B Ordinary Shares |
| |
Cash
Payment (US$) |
| |
Shares
Underlying Company Options |
| |
Exercise
Price (US$) |
| |
Cash
Payment (US$) |
| |
Number of
Company Restricted Shares |
| |
Cash
Payment (US$) |
| |
Total
Cash Payments (US$) |
| ||||||||||||||||||||||||||||||
Richard Jiangong Dai
|
| | | | 246,667 | | | | | | 246,667 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 246,667 | | |
Yu Huang
|
| | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | |
122,500 961,123 |
| | | | |
0.001 1.35 |
| | | | | 594,060 | | | | | | 22,500 | | | | | | 22,500 | | | | | | 616,560 | | |
Robert Ciemniak
|
| | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Jason Chenyang Wei
|
| | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Jianping Ye
|
| | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Lili Chen
|
| | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | |
9,900 42,400 |
| | | | |
0.001 1.35 |
| | | | | 29,225 | | | | | | 3,126 | | | | | | 3,126 | | | | | | 32,351 | | |
Can Xie
|
| | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | |
12,400 95,000 |
| | | | |
0.001 1.35 |
| | | | | 58,025 | | | | | | 15,551 | | | | | | 15,551 | | | | | | 73,576 | | |
Yong Wang
|
| | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | |
34,500 95,000 |
| | | | |
0.001 1.35 |
| | | | | 80,125 | | | | | | — | | | | | | — | | | | | | 80,125 | | |
All directors and executive offices as a Group
|
| | | | 246,667 | | | | | | 246,667 | | | | | | — | | | | | | — | | | | | |
179,300 1,193,523 |
| | | | |
0.001 1.35 |
| | | | | 761,435 | | | | | | 41,177 | | | | | | 41,177 | | | | | | 1,049,279 | | |
Description
|
| |
Amount
|
|
Legal fees and expenses
|
| |
US$ 829,495
|
|
Financial advisory fees and expenses
|
| |
US$ 312,500
|
|
Special Committee fees
|
| |
US$ 20,000
|
|
Filing fees
|
| |
US$ 1,634
|
|
Miscellaneous fees and expenses
|
| |
US$ 10,000
|
|
Total
|
| |
US$1,173,629
|
|
| | |
Trading Price Per ADS (US$)
|
| |||||||||
| | |
High
|
| |
Low
|
| ||||||
2021 | | | | | | | | | | | | | |
First Quarter
|
| | | | 2.53 | | | | | | 2.01 | | |
Second Quarter
|
| | | | 2.35 | | | | | | 1.87 | | |
Third Quarter
|
| | | | 1.92 | | | | | | 1.34 | | |
Fourth Quarter
|
| | | | 1.58 | | | | | | 0.88 | | |
2022 | | | | | | | | | | | | | |
First Quarter
|
| | | | 1.13 | | | | | | 0.90 | | |
Second Quarter
|
| | | | 1.09 | | | | | | 0.68 | | |
Third Quarter
|
| | | | 1.06 | | | | | | 0.63 | | |
Fourth Quarter
|
| | | | 0.94 | | | | | | 0.74 | | |
| | |
For the Year Ended
December 31, |
| |||||||||
| | |
2020
|
| |
2021
|
| ||||||
Revenues (including revenues from related parties RMB11,006 and RMB238 for
the years ended December 31, 2020 and 2021, respectively) |
| | | | 635,910 | | | | | | 620,953 | | |
Cost of revenues (including cost of revenues resulting from transactions with related parties RMB8,981 and RMB8,826 for the years ended December 31, 2020 and 2021, respectively)
|
| | | | (105,528) | | | | | | (110,118) | | |
Gross profit
|
| | | | 530,382 | | | | | | 510,835 | | |
Operating expenses: | | | | | | | | | | | | | |
Selling and marketing expenses (including selling and marketing expenses
resulting from transactions with related parties of RMB4,552 and RMB4,787 for the years ended December 31, 2020 and 2021, respectively) |
| | | | (112,414) | | | | | | (113,626) | | |
General and administrative expenses (including general and administrative expenses resulting from transactions with related parties of RMB2,088 and RMB2,008 for the years ended December 31, 2020 and 2021, respectively)
|
| | | | (85,700) | | | | | | (81,667) | | |
Bad debt expense (including bad debt expense resulting from transactions with a
related party RMB547,069 and RMB1,998 for the years ended December 31, 2020 and 2021, respectively) |
| | | | (559,445) | | | | | | (8,767) | | |
Operating income (loss)
|
| | | | (227,177) | | | | | | 306,775 | | |
Interest income
|
| | | | 1,625 | | | | | | 9,750 | | |
Change in fair value of the warrants
|
| | | | 1,359 | | | | | | — | | |
Investment income
|
| | | | 9,294 | | | | | | 8,458 | | |
Government grants
|
| | | | 5,997 | | | | | | 765 | | |
Income (loss) before income taxes
|
| | | | (208,902) | | | | | | 325,748 | | |
Income tax expense
|
| | | | (109,454) | | | | | | (46,500) | | |
Net income (loss)
|
| | | | (318,356) | | | | | | 279,248 | | |
Less: net income (loss) attributable to noncontrolling interest holders
|
| | | | (304) | | | | | | 66 | | |
Net income (loss) attributable to China Index Holdings Limited
|
| | | | (318,052) | | | | | | 279,182 | | |
Other comprehensive income (loss) | | | | | | | | | | | | | |
Foreign currency translation adjustments, net of nil income taxes
|
| | | | 1,012 | | | | | | 12,811 | | |
Unrealized holding gains on short-term investments, net of nil and nil income taxes for the years ended December 31, 2020 and 2021, respectively
|
| | | | — | | | | | | — | | |
Less: Reclassification adjustment for gains on short-term investments realized in
net income, net of nil and nil income taxes for the years ended December 31, 2020 and 2021, respectively |
| | | | — | | | | | | — | | |
Total comprehensive income (loss)
|
| | | | (317,344) | | | | | | 292,059 | | |
| | |
For the Year Ended
December 31, |
| |||||||||
| | |
2020
|
| |
2021
|
| ||||||
Less: comprehensive income (loss) attributable to noncontrolling interest
holders |
| | | | (304) | | | | | | 66 | | |
Comprehensive income (loss) attributable to China Index Holdings Limited
|
| | | | (317,040) | | | | | | 291,993 | | |
Earnings (loss) per share for Class A and Class B ordinary shares | | | | | | | | | | | | | |
Basic
|
| | | | (3.54) | | | | | | 3.10 | | |
Diluted
|
| | | | (3.54) | | | | | | 3.08 | | |
Weighted average number of Class A and Class B ordinary shares and ordinary shares equivalents outstanding:
|
| | | | | | | | | | | | |
Basic
|
| | | | 89,842,465 | | | | | | 90,196,440 | | |
Diluted
|
| | | | 89,842,465 | | | | | | 90,602,539 | | |
| | |
Three Months Ended
September 30, |
| |||||||||
| | |
2022
|
| |
2021
|
| ||||||
Revenues
|
| | | | 97,669 | | | | | | 160,785 | | |
Cost of revenues
|
| | | | (19,785) | | | | | | (27,493) | | |
Gross profit
|
| | | | 77,884 | | | | | | 133,292 | | |
Operating expenses: | | | | | | | | | | | | | |
Selling and marketing expenses
|
| | | | (22,157) | | | | | | (29,947) | | |
General and administrative expenses
|
| | | | (24,827) | | | | | | (25,332) | | |
Operating income
|
| | | | 30,900 | | | | | | 78,013 | | |
Interest income
|
| | | | 2,091 | | | | | | 3,006 | | |
Investment income (loss)
|
| | | | (2,453) | | | | | | 2,794 | | |
Government grants
|
| | | | 363 | | | | | | 12 | | |
Income before income taxes
|
| | | | 30,901 | | | | | | 83,825 | | |
Income tax expenses
|
| | | | (3,266) | | | | | | (10,994) | | |
Net income
|
| | | | 27,635 | | | | | | 72,831 | | |
Less: net income (loss) attributable to noncontrolling interests
|
| | | | 34 | | | | | | (29) | | |
Net income attributable to China Index Holdings Limited
|
| | | | 27,601 | | | | | | 72,860 | | |
Other comprehensive income (loss) | | | | | | | | | | | | | |
Foreign currency translation adjustments, net of nil income taxes
|
| | | | 17,844 | | | | | | (2,119) | | |
Total comprehensive income
|
| | | | 45,479 | | | | | | 70,712 | | |
Less: comprehensive income (loss) attributable to noncontrolling interests
|
| | | | 34 | | | | | | (29) | | |
Comprehensive income attributable to China Index Holdings Limited
|
| | | | 45,445 | | | | | | 70,741 | | |
Earnings per share for Class A and Class B ordinary shares: | | | | | | | | | | | | | |
Basic
|
| | | | 0.31 | | | | | | 0.81 | | |
Diluted
|
| | | | 0.31 | | | | | | 0.81 | | |
Weighted average number of Class A and Class B ordinary shares and ordinary shares equivalents outstanding:
|
| | | | | | | | | | | | |
Basic
|
| | | | 90,425,368 | | | | | | 90,221,432 | | |
Diluted
|
| | | | 90,425,368 | | | | | | 90,232,243 | | |
| | |
As of December 31,
|
| |||||||||
| | |
2020
|
| |
2021
|
| ||||||
ASSETS | | | | | | | | | | | | | |
Current assets: | | | | | | | | | | | | | |
Cash and cash equivalents
|
| | | | 280,355 | | | | | | 361,521 | | |
Short-term investments
|
| | | | 391,671 | | | | | | — | | |
Accounts receivable, net of allowance for doubtful accounts
|
| | | | 29,680 | | | | | | 49,217 | | |
Prepaid expenses and other current assets
|
| | | | 2,557 | | | | | | 25,531 | | |
Amounts due from a related party – current
|
| | | | 3,090 | | | | | | — | | |
Total current assets
|
| | | | 707,353 | | | | | | 436,269 | | |
Non-current assets: | | | | | | | | | | | | | |
Property and equipment, net
|
| | | | 2,345 | | | | | | 1,424 | | |
Right of use assets
|
| | | | 44,369 | | | | | | 38,892 | | |
Amounts due from a related party – non-current, less allowance for doubtful accounts of RMB547,069 and RMB536,556 as of December 31, 2020 and 2021, respectively
|
| | | | — | | | | | | — | | |
Other non-current assets
|
| | | | 3,270 | | | | | | 4,212 | | |
Total non-current assets
|
| | | | 49,984 | | | | | | 44,528 | | |
Total assets
|
| | | | 757,337 | | | | | | 480,797 | | |
LIABILITIES AND SHAREHOLDERS’ EQUITY (DEFICIT) | | | | | | | | | | | | | |
Current liabilities: | | | | | | | | | | | | | |
Accounts payable
|
| | | | 9,343 | | | | | | 11,465 | | |
Amounts due to a related party
|
| | | | 156 | | | | | | 12,300 | | |
Deferred revenue
|
| | | | 224,141 | | | | | | 216,188 | | |
Income taxes payable
|
| | | | 26,737 | | | | | | 25,474 | | |
Accrued expenses and other current liabilities (including accrued expenses and other current liabilities of VIEs without recourse to the Company of RMB386 and RMB374 as of December 31, 2020 and 2021, respectively)
|
| | | | 637,693 | | | | | | 99,657 | | |
Total current liabilities
|
| | | | 898,070 | | | | | | 365,084 | | |
Non-current liabilities: | | | | | | | | | | | | | |
Long-term lease liabilities
|
| | | | 27,427 | | | | | | 29,570 | | |
Other non-current liabilities
|
| | | | 117,987 | | | | | | 75,288 | | |
Total non-current liabilities
|
| | | | 145,414 | | | | | | 104,858 | | |
Total liabilities
|
| | | | 1,043,484 | | | | | | 469,942 | | |
Commitments and contingencies
|
| | | | — | | | | | | — | | |
SHAREHOLDERS’ EQUITY (DEFICIT) | | | | | | | | | | | | | |
Class A ordinary shares (US$0.001 per share, 1,000,000,000 shares authorized for Class A and Class B in aggregate as of December 31, 2020 and 2021; 72,475,630 shares issued as of December 31, 2020 and 2021; 66,411,428 and 66,787,537 shares outstanding as of December 31, 2020 and 2021, respectively)
|
| | | | 500 | | | | | | 500 | | |
| | |
As of December 31,
|
| |||||||||
| | |
2020
|
| |
2021
|
| ||||||
Class B ordinary shares (US$0.001 per share, 1,000,000,000 shares authorized for Class A and Class B in aggregate as of December 31, 2020 and 2021; 23,636,706 shares issued and outstanding as of December 31, 2020 and 2021; each Class B ordinary share is convertible into one Class A ordinary share)
|
| | | | 163 | | | | | | 163 | | |
Treasury shares (6,064,202 and 5,688,093 shares as of December 31, 2020 and 2021,
respectively) |
| | | | (42) | | | | | | (39) | | |
Capital deficit
|
| | | | (126,571) | | | | | | (121,631) | | |
Retained earnings (accumulated deficits)
|
| | | | (162,728) | | | | | | 116,454 | | |
Accumulated other comprehensive income
|
| | | | 1,232 | | | | | | 14,043 | | |
Total shareholders’ equity (deficit) attributable to China Index Holdings Limited
|
| | | | (287,446) | | | | | | 9,490 | | |
Noncontrolling interests
|
| | | | 1,299 | | | | | | 1,365 | | |
Total shareholders’ equity (deficit)
|
| | | | (286,147) | | | | | | 10,855 | | |
Total liabilities and shareholders’ equity (deficit)
|
| | | | 757,337 | | | | | | 480,797 | | |
|
| | |
As of September 30,
2022 |
| |
As of December 31,
2021 |
| ||||||
ASSETS | | | | | | | | | | | | | |
Current assets: | | | | | | | | | | | | | |
Cash and cash equivalents
|
| | | | 356,841 | | | | | | 361,521 | | |
Short-term investments
|
| | | | 23,576 | | | | | | — | | |
Accounts receivable, net of allowance for doubtful accounts
|
| | | | 63,860 | | | | | | 49,217 | | |
Prepaid expenses and other current assets
|
| | | | 30,500 | | | | | | 25,531 | | |
Amounts due from a related party – current
|
| | | | 8,536 | | | | | | — | | |
Total current assets
|
| | | | 483,313 | | | | | | 436,269 | | |
Non-current assets: | | | | | | | | | | | | | |
Property and equipment, net
|
| | | | 444 | | | | | | 1,424 | | |
Right of use assets
|
| | | | 38,520 | | | | | | 38,892 | | |
Other non-current assets
|
| | | | 5,620 | | | | | | 4,212 | | |
Total non-current assets
|
| | | | 44,584 | | | | | | 44,528 | | |
Total assets
|
| | | | 527,897 | | | | | | 480,797 | | |
LIABILITIES AND SHAREHOLDERS’ EQUITY | | | | | | | | | | | | | |
Current liabilities: | | | | | | | | | | | | | |
Accounts payable
|
| | | | 15,728 | | | | | | 11,465 | | |
Income taxes payable
|
| | | | 10,752 | | | | | | 25,474 | | |
Deferred revenue
|
| | | | 170,730 | | | | | | 216,188 | | |
Amounts due to a related party
|
| | | | — | | | | | | 12,300 | | |
Accrued expenses and other current liabilities
|
| | | | 93,969 | | | | | | 99,657 | | |
Total current liabilities
|
| | | | 291,179 | | | | | | 365,084 | | |
Non-current liabilities: | | | | | | | | | | | | | |
Long-term lease liabilities
|
| | | | 34,368 | | | | | | 29,570 | | |
Other non-current liabilities
|
| | | | 80,299 | | | | | | 75,288 | | |
Total non-current liabilities
|
| | | | 114,667 | | | | | | 104,858 | | |
Total liabilities
|
| | | | 405,846 | | | | | | 469,942 | | |
SHAREHOLDERS’ EQUITY | | | | | | | | | | | | | |
Class A ordinary shares (US$0.001 per share, 1,000,000,000 shares authorized for Class A and Class B in aggregate as of September 30, 2022 and December 31, 2021; 72,475,630 shares issued as of September 30, 2022 and December 31, 2021; 66,788,662 and 66,787,537 shares outstanding as of September 30, 2022 and December 31, 2021, respectively)
|
| | | | 500 | | | | | | 500 | | |
Class B ordinary shares (US$0.001 per share, 1,000,000,000 shares authorized for Class A and Class B in aggregate as of September 30, 2022 and December 31, 2021; 23,636,706 shares issued and outstanding as of September 30, 2022 and December 31, 2021; each Class B ordinary share is convertible into one Class A ordinary
share) |
| | | | 163 | | | | | | 163 | | |
Treasury shares
|
| | | | (39) | | | | | | (39) | | |
Capital deficit
|
| | | | (119,138) | | | | | | (121,631) | | |
Retained earnings
|
| | | | 207,016 | | | | | | 116,454 | | |
Accumulated other comprehensive income
|
| | | | 32,033 | | | | | | 14,043 | | |
Total shareholders’ equity attributable to China Index Holdings Limited
|
| | | | 120,535 | | | | | | 9,490 | | |
Noncontrolling interests
|
| | | | 1,516 | | | | | | 1,365 | | |
Total shareholders’ equity
|
| | | | 122,051 | | | | | | 10,855 | | |
Total liabilities and shareholders’ equity
|
| | | | 527,897 | | | | | | 480,797 | | |
| | |
For the Year Ended
December 31, |
| |||||||||
| | |
2020
|
| |
2021
|
| ||||||
CASH FLOWS FROM OPERATING ACTIVITIES | | | | | | | | | | | | | |
Net income (loss)
|
| | | | (318,356) | | | | | | 279,248 | | |
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
|
| | | | | | | | | | | | |
Share-based compensation expense
|
| | | | 8,612 | | | | | | 4,943 | | |
Depreciation
|
| | | | 1,196 | | | | | | 1,411 | | |
Reduction in the carrying amount of the right of use assets
|
| | | | 5,226 | | | | | | 5,478 | | |
Allowance for doubtful accounts
|
| | | | 12,376 | | | | | | 6,769 | | |
Allowance for amounts due from a related party – non-current
|
| | | | 547,069 | | | | | | 1,998 | | |
Investment income
|
| | | | (9,294) | | | | | | (8,458) | | |
Deferred income tax expense (benefit)
|
| | | | 60,516 | | | | | | (986) | | |
Change in fair value of the warrants
|
| | | | (1,359) | | | | | | — | | |
(Gain) loss on disposal of property and equipment
|
| | | | (5) | | | | | | (36) | | |
Changes in operating assets and liabilities, net of effects of acquisition and disposal of subsidiaries:
|
| | | | | | | | | | | | |
Accounts receivable
|
| | | | (17,744) | | | | | | (26,307) | | |
Prepayments to and amounts due from related parties
|
| | | | 4,820 | | | | | | — | | |
Prepaid expenses and other current assets
|
| | | | (1,546) | | | | | | (4,802) | | |
Accounts payable
|
| | | | 1,499 | | | | | | 2,122 | | |
Amounts due to a related party
|
| | | | (7,282) | | | | | | 12,215 | | |
Deferred revenue
|
| | | | 20,623 | | | | | | (7,945) | | |
Income tax payable
|
| | | | 3,341 | | | | | | (1,262) | | |
Amounts due from a related party – non-current
|
| | | | (547,069) | | | | | | (1,998) | | |
Accrued expenses and other current liabilities
|
| | | | 557,590 | | | | | | (7,067) | | |
Long-term lease liabilities
|
| | | | (10,252) | | | | | | 2,143 | | |
Other non-current liabilities
|
| | | | 17,583 | | | | | | (42,646) | | |
Net cash provided by operating activities
|
| | | | 327,544 | | | | | | 214,820 | | |
CASH FLOWS FROM INVESTING ACTIVITIES | | | | | | | | | | | | | |
Purchase of short-term investments
|
| | | | (4,084,440) | | | | | | (2,199,090) | | |
Proceeds from sales of short-term investments
|
| | | | 3,827,063 | | | | | | 2,599,219 | | |
Purchase of property and equipment
|
| | | | (585) | | | | | | (491) | | |
Proceeds from disposal of property and equipment
|
| | | | 5 | | | | | | 36 | | |
Proceeds from disposal of subsidiaries
|
| | | | 4,325 | | | | | | — | | |
Cash disposed for sales of subsidiaries
|
| | | | (1,035) | | | | | | — | | |
Advance to a noncontrolling interest holder
|
| | | | (3,090) | | | | | | — | | |
Cash acquired from business acquisition
|
| | | | 7 | | | | | | — | | |
Advance to a third party
|
| | | | — | | | | | | (18,151) | | |
Repayment of advance to a noncontrolling interest holder
|
| | | | — | | | | | | 3,090 | | |
Net cash provided by (used in) investing activities
|
| | | | (257,750) | | | | | | 384,613 | | |
| | |
For the Year Ended
December 31, |
| |||||||||
| | |
2020
|
| |
2021
|
| ||||||
CASH FLOWS FROM FINANCING ACTIVITIES | | | | | | | | | | | | | |
Net transfers to the parent company
|
| | | | — | | | | | | — | | |
Cash received from a third party for loan collateral
|
| | | | — | | | | | | 18,141 | | |
Settlement of guarantee liability in relation to convertible notes issued by a related party
|
| | | | — | | | | | | (540,375) | | |
Net cash used in financing activities
|
| | | | — | | | | | | (522,234) | | |
Effect of foreign currency exchange rate changes on cash and cash equivalents
|
| | | | (3,515) | | | | | | 3,967 | | |
Net increase in cash and cash equivalents
|
| | | | 66,279 | | | | | | 81,166 | | |
Cash and cash equivalents as of the beginning of the year
|
| | | | 214,076 | | | | | | 280,355 | | |
Cash and cash equivalents as of the end of the year
|
| | | | 280,355 | | | | | | 361,521 | | |
Supplemental disclosure of cash flow information: | | | | | | | | | | | | | |
Income tax paid
|
| | | | 25,645 | | | | | | 29,394 | | |
Withholding income tax paid
|
| | | | — | | | | | | 62,000 | | |
Issuance of warrants in connection with the separation from Fang
|
| | | | — | | | | | | — | | |
Net assets and noncontrolling interests acquired in business acquisition
|
| | | | 1,603 | | | | | | — | | |
| | |
Shares Beneficially Owned as of
January 18, 2023 |
| |||||||||
| | |
Number
|
| |
Percentage
|
| ||||||
Directors and Executive Officers | | | | | | | | | | | | | |
Richard Jiangong Dai(1)
|
| | | | 9,047,809 | | | | | | 10.0% | | |
Yu Huang(2)
|
| | | | 616,560 | | | | | | * | | |
Lili Chen(3)
|
| | | | 32,351 | | | | | | * | | |
Can Xie(4)
|
| | | | 73,576 | | | | | | * | | |
Yong Wang(5)
|
| | | | 80,125 | | | | | | * | | |
Robert Ciemniak
|
| | | | — | | | | | | — | | |
Jason Chenyang Wei
|
| | | | — | | | | | | — | | |
Jianping Ye
|
| | | | — | | | | | | — | | |
Directors and executive officers as a group
|
| | | | 9,850,421 | | | | | | 10.9% | | |
Principal Shareholders:
|
| | | | | | | | | | | | |
Mr. Vincent Tianquan Mo and his affiliated entities(6)
|
| | | | 29,075,794 | | | | | | 30.5% | | |
Fang Holdings Limited(7)
|
| | | | 18,084,101 | | | | | | 20.0% | | |
General Atlantic Singapore Fund Pte. Ltd.(8)
|
| | | | 10,122,769 | | | | | | 11.2% | | |
Evenstar Capital Management Limited(9)
|
| | | | 11,221,618 | | | | | | 12.4% | | |
Davis Selected Advisers, L.P.(10)
|
| | | | 4,452,643 | | | | | | 4.9% | | |
Other Filing Persons: | | | | | | | | | | | | | |
Mr. Shan Li and Digital Link Investments Limited(11)
|
| | | | 3,137,921 | | | | | | 3.5% | | |
True Knight Limited(12)
|
| | | | 8,801,142 | | | | | | 9.7% | | |
|
Exhibit No.
|
| |
Description
|
|
|
(a)(1)
|
| | | |
|
(a)(2)
|
| | | |
|
(a)(3)
|
| | | |
|
(a)(4)
|
| | | |
|
(a)(5)
|
| | | |
|
(a)(6)
|
| | | |
|
(a)(7)
|
| | |
|
Exhibit No.
|
| |
Description
|
|
|
(a)(7)
|
| | | |
|
(c)(1)
|
| | Opinion of Roth Capital Partners, LLC, dated as of December 22, 2022 | |
|
(c)(2)
|
| | | |
|
(d)(1)
|
| | | |
|
(d)(2)
|
| | | |
|
(d)(3)
|
| | | |
|
(d)(4)
|
| | | |
|
(d)(5)
|
| | | |
|
(f)(1)
|
| | Dissenters’ Rights. See “Special Factors — Dissenters’ or Appraisal Rights” | |
|
(f)(2)
|
| | | |
|
(e)
|
| | Not applicable | |
|
107
|
| | Calculation of Filing Fees | |
Name
|
| |
Business Address
|
| |
Present Principal Occupation or
Employment |
| |
Country of
Citizenship |
|
Richard Jiangong Dai(1)
|
| | Tower A, No. 20 Guogongzhuang Middle Street, Fengtai District, Beijing 100070, the People’s Republic of China | | | Chairman of the board of directors | | | PRC | |
Yu Huang(2) | | | Tower A, No. 20 Guogongzhuang Middle Street, Fengtai District, Beijing 100070, the People’s Republic of China | | | Director, chief executive officer and president | | | PRC | |
Robert Ciemniak(3) | | | Tower A, No. 20 Guogongzhuang Middle Street, Fengtai District, Beijing 100070, the People’s Republic of China | | | Independent director | | | UK | |
Jason Chenyang Wei(4) | | | Tower A, No. 20 Guogongzhuang Middle Street, Fengtai District, Beijing 100070, the People’s Republic of China | | | Independent director | | | PRC | |
Jianping Ye(5) | | | Tower A, No. 20 Guogongzhuang Middle Street, Fengtai District, Beijing 100070, the People’s Republic of China | | | Independent director | | | PRC | |
Lili Chen(6) | | | Tower A, No. 20 Guogongzhuang Middle Street, Fengtai District, Beijing 100070, the People’s Republic of China | | | Deputy chief financial officer | | | PRC | |
Can Xie(7) | | | Tower A, No. 20 Guogongzhuang Middle Street, Fengtai District, Beijing 100070, the People’s Republic of China | | |
Chief technology officer
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| | PRC | |
Yong Wang(8) | | | Tower A, No. 20 Guogongzhuang Middle Street, Fengtai District, Beijing 100070, the People’s Republic of China | | | Vice president | | | PRC | |
Name
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Business Address
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Present Principal Occupation or
Employment |
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Country of
Citizenship |
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Jiangong Dai(1) | | |
Tower A, No. 20 Guogongzhuang
Middle Street, Fengtai District, Beijing 100070, the People’s Republic of China |
| | Director | | | PRC | |
Name
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Business Address
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Present Principal Occupation or
Employment |
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Country of
Citizenship |
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Jiangong Dai(1) | | |
Tower A, No. 20 Guogongzhuang
Middle Street, Fengtai District, Beijing 100070, the People’s Republic of China |
| | Director | | | PRC | |
Name
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Business Address
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Present Principal Occupation or
Employment |
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Country of
Citizenship |
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Jiangong Dai(1) | | | Tower A, No. 20 Guogongzhuang Middle Street, Fengtai District, Beijing 100070, the People’s Republic of China | | | Executive Chairman of the Board | | | PRC | |
Jian Liu(2) | | | Tower A, No. 20 Guogongzhuang Middle Street, Fengtai District, Beijing 100070, the People’s Republic of China | | | Director and Chief Executive Officer | | | PRC | |
Shaohua Zhang(3) | | | Tower A, No. 20 Guogongzhuang Middle Street, Fengtai District, Beijing 100070, the People’s Republic of China | | | Independent Director | | | PRC | |
Howard Huyue Zhang(4)
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| | Tower A, No. 20 Guogongzhuang Middle Street, Fengtai District, Beijing 100070, the People’s Republic of China | | | Independent Director | | | Hong Kong SAR | |
Changming Yan(5) | | | Tower A, No. 20 Guogongzhuang Middle Street, Fengtai District, Beijing 100070, the People’s Republic of China | | | Independent Director | | | Canada | |
Yu Huang(6) | | | Tower A, No. 20 Guogongzhuang Middle Street, Fengtai District, Beijing 100070, the People’s Republic of China | | | Independent Director | | | PRC | |
Peng Cui(7) | | | Tower A, No. 20 Guogongzhuang Middle Street, Fengtai District, Beijing 100070, the People’s Republic of China | | | Chief Financial Officer | | | PRC | |
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Employment |
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Country of
Citizenship |
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Tianquan Mo(1)
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Tower A, No. 20 Guogongzhuang
Middle Street, Fengtai District, Beijing 100070, the People’s Republic of China |
| | Director | | | PRC | |
Name
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Business Address
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Present Principal Occupation or
Employment |
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Country of
Citizenship |
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Tianquan Mo(1)
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Tower A, No. 20 Guogongzhuang
Middle Street, Fengtai District, Beijing 100070, the People’s Republic of China |
| | Director | | | PRC | |
Name
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Business Address
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Employment |
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Country of Citizenship
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Tianquan Mo(1)
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Tower A, No. 20 Guogongzhuang
Middle Street, Fengtai District, Beijing 100070, the People’s Republic of China |
| | Director | | | PRC | |
Jing Cao(2) | | |
c/o P.O. Box 957, Offshore
Incorporations Centre, Road Town, Tortola, British Virgin Islands |
| | Director | | | USA | |
Name
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Business Address
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Present Principal Occupation or
Employment |
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Country of
Citizenship |
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Jing Cao(1) | | |
c/o P.O. Box 957, Offshore
Incorporations Centre, Road Town, Tortola, British Virgin Islands |
| | Director | | | USA | |
Name
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Business Address
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Present Principal Occupation or
Employment |
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Country of
Citizenship |
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Jing Cao(1) | | |
c/o P.O. Box 957, Offshore
Incorporations Centre, Road Town, Tortola, British Virgin Islands |
| | Director | | | USA | |
Name
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Business Address
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Present Principal Occupation or
Employment |
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Country of
Citizenship |
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Jiangong Dai(1) | | |
Tower A, No. 20 Guogongzhuang
Middle Street, Fengtai District, Beijing 100070, the People’s Republic of China |
| | Director | | | PRC | |
Name
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Business Address
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Present Principal Occupation or
Employment |
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Country of
Citizenship |
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Shan Li(1) | | |
Unit 219, 2/F Building 16W, Phase
Three, Hong Kong Science Park, Pak Shek Kok, New Territories, Hong Kong |
| | Director | | | PRC | |
Name
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Business Address
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Present Principal Occupation or
Employment |
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Country of
Citizenship |
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Ong Yu Huat | | |
Asia Square Tower 1
8 Marina View, #41-04 Singapore 018960 |
| | Director of General Atlantic Singapore Fund Management Pte. Ltd. | | | Singapore | |
Izkandar Bloy | | |
Asia Square Tower 1
8 Marina View, #41-04 Singapore 018960 |
| | Director of General Atlantic Singapore Fund Management Pte. Ltd. | | | Malaysia | |
Name
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Business Address
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Employment |
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Country of
Citizenship |
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William E. Ford
(Chief Executive Officer) |
| |
55 East 52nd Street
33rd Floor New York, New York 10055 |
| | Managing Director of GA LP | | | USA | |
Gabriel Caillaux | | |
23 Savile Row
London W1S 2ET United Kingdom |
| | Managing Director of GA LP | | | France | |
Andrew Crawford | | |
55 East 52nd Street
33rd Floor New York, New York 10055 |
| | Managing Director of GA LP | | | USA | |
Martin Escobari | | |
55 East 52nd Street
33rd Floor New York, New York 10055 |
| | Managing Director of GA LP | | | Bolivia and Brazil | |
Anton J. Levy | | |
55 East 52nd Street
33rd Floor New York, New York 10055 |
| | Managing Director of GA LP | | | USA | |
Sandeep Naik | | |
Asia Square Tower 1
8 Marina View, #41-04 Singapore 018960 |
| | Managing Director of GA LP | | | USA | |
Graves Tompkins | | |
55 East 52nd Street
33rd Floor New York, New York 10055 |
| | Managing Director of GA LP | | | USA | |
Name
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N. Robbert Vorhoff
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55 East 52nd Street
33rd Floor New York, New York 10055 |
| | Managing Director of GA LP | | | USA | |
Eric Zhang | | |
Suite 5704 – 5706, 57F
Two IFC, 8 Finance Street Central, Hong Kong, China |
| | Managing Director of GA LP | | | Hong Kong SAR | |
Name
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Business Address
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Present Principal Occupation or
Employment |
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Country of
Citizenship |
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Michael Gosk | | |
55 East 52nd Street
33rd Floor New York, New York 10055 |
| | Managing Director of GA LP | | | USA | |
Christopher G. Lanning | | |
55 East 52nd Street
33rd Floor New York, New York 10055 |
| | Managing Director of GA LP | | | USA | |
Name
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Business Address
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Present Principal Occupation or
Employment |
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Evenstar Manager | | | | | | | | | | |
James Ting-Yeh Yang | | | 29/F, 18 Pennington Street, Causeway Bay, Hong Kong | | | Director | | | USA | |
Anna Goubault | | | 4th Floor, Century Yard, Cricket Square, PO Box 31162, George Town, Grand Cayman, KY1-1205, Cayman Islands | | |
Director
Independent director of Calderwood
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| | Cayman Islands (British Overseas Territories Citizen) | |
Charles Thomas | | | 4th Floor, Century Yard, Cricket Square, PO Box 31162, George Town, Grand Cayman, KY1-1205, Cayman Islands | | |
Director
Independent director of Calderwood
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| | United Kingdom | |
Exhibit (c)-(1)
December 22, 2022
Special Committee
China Index Holdings Limited
Tower A, No. 20 Guogongzhuang Middle Street
Fengtai District
Beijing 100070
People’s Republic of China
Members of the Special Committee:
ROTH Capital Partners, LLC (“we” or “ROTH”) understands that China Index Holdings Limited, an exempted company with limited liability incorporated under the laws of the Cayman Islands (the “Company”), CIH Holdings Limited, an exempted company with limited liability incorporated under the laws of the Cayman Islands (“Parent”), and CIH Merger Sub Holdings Limited, an exempted company with limited liability incorporated under the laws of the Cayman Islands and a wholly owned subsidiary of Parent (“Merger Sub”) propose to enter into an Agreement and Plan of Merger, substantially in the form of the draft delivered to ROTH on December 21, 2022 (the “Merger Agreement”), which provides, among other things, for the merger (the “Merger”) of Merger Sub with and into the Company, with the Company surviving the Merger as a wholly owned subsidiary of Parent. Capitalized terms in this letter that are not defined herein shall have the meaning set forth in the Merger Agreement.
Pursuant to the Merger Agreement, the parties wish to effect a business combination pursuant to which Merger Sub will be merged with and into the Company through a short-form merger in accordance with Section 233(7) of the Companies Act, with the Company being the surviving company and becoming a wholly owned subsidiary of Parent; as a condition and inducement to the Company’s willingness to enter into this Agreement, concurrently with the execution and delivery of the Merger Agreement, the shareholders participating as part of the purchasing group including, Fang Holdings, ACE Smart Investments Limited, Media Partner Technology Limited, Next Decade Investments Limited, Karistone Limited, Open Land Holdings Limited, True Knight Limited, Digital Link Investments Limited, General Atlantic Singapore Fund Pte. Ltd., Evenstar Master Fund SPC for and on behalf of Evenstar Master Sub-Fund I Segregated Portfolio, and Evenstar Special Situations Limited, collectively (the “Rollover Shareholders”), Parent and Merger Sub will enter into an equity contribution agreement, pursuant to which the Rollover Shareholders will irrevocably contribute their respective Rollover Shares to Merger Sub prior to the Closing in exchange for newly issued shares of Parent, such that Merger Sub will directly hold 51,956,963 Class A Shares and 23,636,706 Class B Shares immediately prior to the Effective Time, collectively representing approximately 82% of the ownership and 95% of the voting power of the Shares (as defined below) exercisable in a general meeting of the Company in aggregate
1
Pursuant to the Merger Agreement, each Class A Share (entitled to one (1) vote) and each Class B Share (entitled to ten (10) votes), each with a par value of US$0.001 per share, of the Company (a “Share” or, collectively, the “Shares”), issued and outstanding immediately prior to the Merger, other than (i) (a) the Rollover Shares, (b) Shares (including Shares represented by ADSs) held by any of Parent, Merger Sub and any of their respective Affiliates, (c) Shares (including Shares represented by American Depository Shares (an “ADS” or collectively “ADSs”)) held by the Company or any Subsidiary of the Company or held in the Company’s treasury, and (d) any Shares (including Shares represented by ADSs) held by the Depositary and reserved for issuance, settlement and allocation pursuant to the Share Incentive Plan (collectively, the “Excluded Shares”), (ii) Dissenting Shares and (iii) the Shares represented by ADSs, shall be cancelled in exchange for the right to receive US$1.00 in cash per Share (the “Per Share Merger Consideration”). Each ADS, representing one (1) Class A Share, issued and outstanding immediately prior to the Effective Time (other than ADSs representing the Excluded Shares), together with the underlying Class A Shares represented by such ADSs, shall be cancelled in exchange for the right to receive the Per Share Merger Consideration. The Per Share Merger Consideration is hereafter referred to as the “Merger Consideration”. The terms and conditions of the Merger are more fully set forth in the Merger Agreement.
You have asked for our opinion as to whether the Merger Consideration to be received by the holders of the Shares (other than the Excluded Shares and Dissenting Shares) and holders of ADSs (other than ADSs representing the Excluded Shares) pursuant to the Merger Agreement is fair, from a financial point of view, to such holders.
For purposes of the opinion set forth herein, we have, among other things:
· | reviewed certain publicly available financial statements and other business and financial information of the Company; |
· | performed due diligence of the business, operations, financial condition and prospects of the Company and reviewed the financial terms and the form of consideration offered; |
· | reviewed certain internal financial statements and other financial and operating data concerning the Company prepared by the management of the Company; |
· | reviewed certain financial projections concerning the Company prepared by the management of the Company (the “Financial Projections”); |
· | reviewed the reported prices and trading activity for the ADSs; |
· | reviewed the financial terms, to the extent publicly available, of certain acquisition transactions we deemed comparable with the Merger and compared such financial terms with those of the Merger; |
· | compared the financial performance of the Company and the prices and trading activity of the ADSs with that of certain other publicly-traded companies we deemed comparable with the Company and its securities; |
· | participated in certain discussions with representatives of the Special Committee and its legal advisor; |
· | reviewed a draft of the Merger Agreement delivered to ROTH on December 21, 2022; |
· | reviewed a draft of the Equity Contribution Agreement delivered to ROTH on December 21, 2022; and |
· | performed such other analyses, reviewed such other information and considered such other factors as we have deemed appropriate. |
2
We have assumed and relied upon, without independent verification, the accuracy and completeness of the information that was publicly available or supplied or otherwise made available to us by the Company, which formed a substantial basis for this opinion, and have further relied upon the assurances of the management of the Company that such information does not contain an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements contained therein not misleading in any material respect. With respect to the Financial Projections, we have been advised by the management of the Company, and assumed, that they have been reasonably prepared on bases reflecting the best currently available estimates and judgments of the management of the Company of the future financial performance of the Company and we express no view as to the assumptions on which they are based. In addition, we have assumed that the final executed Merger Agreement and Equity Contribution Agreement will not differ in any material respect from the draft Merger Agreement and Equity Contribution Agreement reviewed by us, and that the Merger will be consummated in accordance with the terms set forth in the Merger Agreement without any waiver, amendment or delay of any terms or conditions. We have also assumed that in connection with the receipt of all the necessary governmental, regulatory or other approvals and consents required for the proposed Merger, no delays, limitations, conditions or restrictions will be imposed that would have an adverse effect on the Company or the contemplated benefits expected to be derived in the proposed Merger. We are not legal, tax, accounting or regulatory advisors.
We are financial advisor only and have relied upon, without independent verification, the assessment of the Company and its legal, tax, accounting and regulatory advisors with respect to legal, tax, accounting and regulatory matters. We express no opinion with respect to the fairness of the amount or nature of the compensation to any of the Company’s officers, directors or employees, or any class of such persons, relative to the Merger Consideration to be received by the holders of Shares and ADSs in the Merger.
Our opinion does not address the fairness of any consideration to be received or paid by the holders of Excluded Shares or to the holders of any other class of securities, creditors or other constituencies of the Company. Our opinion does not address the value of Parent shares associated with the Exchange Ratio. Our opinion does not address the underlying business decision of the Company to pursue the Merger or the relative merits of the Merger as compared to any other alternative business transaction, or other alternatives, or whether or not such alternatives could be achieved or are available. We have not made any independent valuation or appraisal of the assets or liabilities (fixed, contingent or otherwise) of the Company, nor have we been furnished with any such valuations or appraisals, nor have we assumed any obligation to conduct, nor have we conducted, any physical inspection of the properties, facilities or other assets of the Company. We have not evaluated the solvency of the Company under any law of any jurisdiction relating to bankruptcy, insolvency or similar matters. As you know, we are not legal experts, and for purposes of our analysis, we have not made any assessment of the status of any outstanding litigation involving the Company and have excluded the effects of any such litigation in our analysis. Our opinion is necessarily based on financial, economic, market and other conditions as in effect on, and the information made available to us as of, the date hereof. Events occurring after the date hereof may affect this opinion and the assumptions used in preparing it, and we do not assume any obligation to update, revise or reaffirm this opinion.
We have acted as financial advisor to the Special Committee of the Board of Directors of the Company in connection with this transaction and will receive a fee for our services. The fee for this opinion is not contingent upon the consummation of the Merger. In addition, the Company has agreed to indemnify us for certain liabilities and other items arising out of our engagement, which indemnity obligation is not contingent on the consummation of the Merger.
3
ROTH is a full service securities firm engaged in securities trading and brokerage activities, as well as providing investment banking and other financial services. In the ordinary course of business, we and our affiliates may acquire, hold or sell, for our and our affiliates’ own accounts and for the accounts of customers, equity, debt and other securities and financial instruments (including bank loans and other obligations) of the Company and the other parties to the Merger, and, accordingly, may at any time hold a long or a short position in such securities. ROTH and its affiliates may in the future provide investment banking and other financial services to Parent and their respective affiliates for which we would expect to receive compensation.
This opinion has been approved by a committee of ROTH investment banking and other professionals in accordance with our customary practice. This opinion is for the information of the Special Committee of the Board of Directors of the Company only and may not be used for any other purpose without our prior written consent, except that we have consented to the inclusion of a copy of this opinion in its entirety in any filing the Company is required to make with the Securities and Exchange Commission in connection with the Merger in accordance with the terms of our engagement letter with the Special Committee, if such inclusion is required by applicable law. In addition, this opinion does not in any manner address the prices at which the ADSs will trade at any time.
On the basis and subject to the foregoing, and such other factors as we deemed relevant, we are of the opinion on the date hereof that the Merger Consideration to be received by the holders of Shares (other than the Excluded Shares and Dissenting Shares) and holders of ADSs (other than ADSs representing the Excluded Shares) pursuant to the Merger Agreement is fair, from a financial point of view, to such holders.
Very truly yours,
ROTH Capital Partners, LLC
4
Fairness Opinion Presentation to the Special Committee at China Index Holdings Limited December 22, 2022 1 Roth Capital Partners, LLC Corporate Office: 888 San Clemente Drive, Newport Beach, CA 92660 | 949.720.5700 | 800.678.9147 | www.roth.com | Member SIPC / FINRA Regional Offices: Chicago, IL | Los Angeles, CA | Miami Beach, FL | New York, NY | San Francisco, CA STRICTLY PRIVATE AND CONFIDENTIAL 1) Analyses as of 12/20/22 U.S. |
| 2 STRICTLY PRIVATE AND CONFIDENTIAL Disclosure This presentation was prepared by Roth Capital Partners, LLC (“Roth”) and provided to the Special Committee of the Board of Directors (the “Special Committee”) of China Index Holdings Limited (the “Company” or “CIH”) in connection with their consideration of a potential transaction with CIH Holdings Limited (the “Parent” or “Buyer”), and CIH Merger Sub Holdings Limited, a wholly - owned subsidiary of Parent (the “Transaction”) . This presentation has been provided to the Special Committee by Roth and may not be used or relied upon by any other person for any purpose without the written consent of Roth . The information contained herein is confidential . By accepting this presentation, you agree to use it for informational purposes only and will not disclose any such information to any other party without the written consent of Roth . This presentation has not been prepared with a view toward public disclosure under state or federal securities laws or otherwise . Reproduction, dissemination, quotation, summarization or reference to this presentation without Roth’s written consent is prohibited . The information utilized in preparing this presentation was obtained from the Company and other public sources . Roth assumes no responsibility for independent investigation or verification of such information and has relied on such information being complete and accurate in all material respects . To the extent such information includes estimates and/or forecasts of future performance prepared by Company management, we have assumed that such estimates and forecasts have been reasonably prepared on bases reflecting the best currently available estimates and judgments of Company management . As Roth is relying on the Company for the information required to deliver its analysis, Roth makes no representation or warranty, express or implied, as to the accuracy or completeness of such information and nothing contained herein is, or shall be relied upon as, a representation, whether as to the past or the future . Roth has no obligation, express or implied, to update any or all of the information contained in this presentation or to advise you of any changes thereto . Because this presentation was prepared for use in the context of an oral presentation to the Special Committee, which is familiar with the business and affairs of the Company, Roth does not take any responsibility for the accuracy or completeness of any of the material included in this presentation if used by persons other than the Special Committee . This presentation is not intended to provide the sole basis for evaluating the prospective Transaction, and it should not be considered a recommendation with respect to this Transaction, any other transaction or any other matter . Prior to entering into any transaction, the Company and the Special Committee should determine, without reliance on Roth, the economic merits and risks as well as the legal, tax and accounting consequences of any such transaction . This presentation does not constitute an opinion and Roth’s only opinion is the written opinion that is to be rendered to the Special Committee . In preparing this presentation, Roth has made certain assumptions regarding the information contained herein and certain limitations apply to such information . For a detailed description of these assumptions and limitations, we refer you to the written fairness opinion to be delivered to the Special Committee by Roth . |
| 3 STRICTLY PRIVATE AND CONFIDENTIAL I. Transaction Overview 4 II. Valuation Analysis 10 III. Appendix 26 Table of Contents |
| 4 STRICTLY PRIVATE AND CONFIDENTIAL I. Transaction Overview |
| 5 STRICTLY PRIVATE AND CONFIDENTIAL Transaction Overview Summary of the Proposal • CIH is being acquired in a cash transaction for $1.00/ sh by Buyer. Buyer includes a group of existing ADS and shareholder participants led by Fang Holdings, collectively the ‘Buyer Consortium”. The Buyer Consortium represents approx. 82% ownership and 95% voting control of CIH. The Buyer Consortium shares are excluded from the transaction • The Buyer Consortium is lead by Fang Holdings Limited, the entity from which CIH was spun - out of in 2019, and its controlling shareholder, Tianquan Mo • Expected closing Q1 2023 Transaction • Implied enterprise value of $ 42.3MM • Implied equity value of $ 16.4MM to Minority Holders, of which $14.8M will be paid in cash. The remaining balance related to “Restricted Securities” will be exchanged Consideration • Buyer Consortium to contribute their shares pursuant to an equity commitment agreement • Restricted Securities to be exchanged into Parent shares at the Exchange Ratio 1 • Fang Holdings to provide cash to fund the merger • Fang Holdings has in excess of $50 million on its balance sheet Financing 1) The “Exchange Ratio” is the ratio of the Per Share Merger Consideration divided by the fair market value of one share of P are nt as of the Effective Time |
| 6 STRICTLY PRIVATE AND CONFIDENTIAL As of 12/21/22 Name of Shareholders 3 A B C A + B + C Ownership Voting Tianquan Mo 11,709,098 12,517,020 - 48,452,236 26.3% 45.2% Buyer Group Fang Holdings Limited 6,964,415 11,119,686 - 18,084,101 19.7% 39.0% Buyer Group Evenstar 11,221,618 - - 11,221,618 12.2% 3.7% Buyer Group General Atlantic 10,122,769 - - 10,122,769 11.0% 3.3% Buyer Group TRUE Knight 8,801,142 - - 8,801,142 9.6% 2.9% Buyer Group Digital Link 3,137,921 - - 3,137,921 3.4% 1.0% Buyer Group Total Buyer Group 51,956,963 23,636,706 - 75,593,669 82.2% 95.1% Others on the market 14,831,699 - - 14,831,699 16.1% 4.9% To be purchased Restricted Securities - - 1,538,730 1,538,730 1.7% 0.0% To be purchased Total Outstanding 66,788,662 23,636,706 1,538,730 91,964,098 100.0% 100.0% As of 12/21/22 Name of Shareholders 3 A B C A + B + C Ownership Voting Tianquan Mo 11,709,098 12,517,020 - 48,452,236 26.3% 44.9% Buyer Group Fang Holdings Limited 6,964,415 11,119,686 - 18,084,101 19.7% 38.8% Buyer Group Evenstar 11,221,618 - - 11,221,618 12.2% 3.7% Buyer Group General Atlantic 10,122,769 - - 10,122,769 11.0% 3.3% Buyer Group TRUE Knight 8,801,142 - - 8,801,142 9.6% 2.9% Buyer Group Digital Link 3,137,921 - - 3,137,921 3.4% 1.0% Buyer Group Total Buyer Group 51,956,963 23,636,706 - 75,593,669 82.2% 94.6% Others on the market 14,831,699 - - 14,831,699 16.1% 4.9% To be purchased Restricted Securities - - 1,538,730 1,538,730 1.7% 0.5% To be purchased Total Outstanding 66,788,662 23,636,706 1,538,730 91,964,098 100.0% 100.0% Transaction Overview Ownership Table and Buyer Consortium Overview 1,2 1) Source: Capitalization table provided by Management 2) Treasury Shares are excluded from Capitalization Table for purposes of deriving ownership and voting percentages 3) Class A shares offer 1 voting right per share, and Class B shares offer 10 voting rights per share • Buyer consortium represents approximately 82 % of ownership and 95 % of voting control Assumes Restricted Securities do not have Voting Rights: Assumes Restricted Securities have Voting Rights: |
| 7 STRICTLY PRIVATE AND CONFIDENTIAL $0.00 $1.00 $2.00 $3.00 $4.00 $5.00 $6.00 0 1.00mm 2.00mm 3.00mm 4.00mm 5.00mm 6.00mm Volume Share Price (USD$) Transaction Overview Company Timeline Source: Capital I.Q. as of 12/20/22 06/12/19: CIH’s first trading day following its spin out. Fang’s share price drops from $59.50 to $46.00 from 6/10 to 6/13, a 22.7% change CIH was in talks to be acquired by General Atlantic through a public - to - private LBO as of November 30, 2020, for an undisclosed amount. Subsequently, the deal was canceled. 04/30/20: CIH files a $10.16M common stock shelf registration 05/31/20: CIH closed two acquisitions. Acquiring 67% in Shouzheng Credit Rating Ltd. In a related transaction, CIH entered into a separate agreement to acquire China Index Credit Rating Ltd. 08/23/22: Fang proposed to acquire all outstanding Class A and Class B ordinary shares of CIH, that are not currently owned by Fang in a “going - private” transaction. The consideration payable for each Share and each ADS to be acquired will be US$0.84. The US$0.84 per share/ADS price represents a premium of 20.0% to the closing price of the ADSs on 08/22/22 and a premium of 22.8% to the volume - weighted average closing price of the ADSs during the last 30 trading days up to 08/22/22 04/30/22 & 05/10/22: Schedule 13 - D Transactions filed with the SEC at $0.95 per ADS (see following page) 12/09/22: the Buyer Consortium formally increases its offer to $1.00/share |
| 10 STRICTLY PRIVATE AND CONFIDENTIAL II. Valuation Analysis |
| 11 STRICTLY PRIVATE AND CONFIDENTIAL Valuation Analysis Valuation Methodologies and Key Assumptions Comparable Companies Discounted Cash Flows (“DCF”) ▪ Compared CIH’s implied offered multiple relative to multiples of comparable publicly traded companies ▪ Comparable companies included names in the real estate services, internet and direct marketing retail, internet and infrastructure services, and application software industries ▪ Estimated the DCF value of Target based on management’s cash flow projections: • Management financial projections ( 2023 - 2025 ) • Considered weighted average cost of capital (“WACC”) range of 17.8% to 21.8% • Considered a perpetual growth rate range of 2.0% to 4.0% Precedent Transactions Premiums Analysis – U.S. listed Take - Privates ▪ Compared CIH’s offered multiple against multiples paid in comparable precedent transactions ▪ Reviewed comparable precedent transactions from 12/20/17 to present in the real estate advertising, analytics, insight and online marketplace industries ▪ Screened for U.S. listed public company take - private transactions covering the trailing 36 months ▪ Analyzed share price premiums 1 day, 1 week and 1 month prior to announcement of a transaction where the buyer sought ownership in excess of 90% 13 - D Transactions Premiums Analysis – Global Majority Shareholder Purchasing Remaining Shares ▪ Reviewed the Company’s historical 13 - D Filings from April and May 2022 relative to the consideration proposed in this Transaction ▪ Screened for international public company majority shareholder purchasing remaining shares take - private transactions covering the trailing 36 months ▪ Analyzed share price premiums 1 day, 1 week and 1 month prior to announcement of a transaction where the majority shareholder sought to purchase remaining shares |
| 12 STRICTLY PRIVATE AND CONFIDENTIAL Valuation Analysis Other Data and Considerations CIH History as a U . S . Listed Public Company • CIH was spun out of its parent company Fang Holdings Limited (OTCPK : “SFUN . Y”) and directly listed on the Nasdaq • The rationale for the listing was to enhance strategic and management focus of the two companies, including separating Fang’s commercial property - related business from CIH’s information and analytics services business by allocating capital more efficiently and independently increasing brand recognition of the two independently listed companies • CIH never raised capital from public shareholders Deteriorating Market Environment for US Listed Chinese Companies • Over the past few years, the market environment for US Listed Chinese Companies has deteriorated • Dec 2020 passage of The Holding Foreign Companies Accountable Act has led to an acceleration of US listed Chinese company delistings and threatened the listing status of more than half of the 262 US listed Chinese companies as of Sept 30 , 2022 1 • On July 30 , 2021 , the SEC published a statement on investor protections vis - à - vis VIE structures, causing significant concern over the viability of the structure going forward . As of that date, there were an estimated 184 US listed Chinese companies utilizing the VIE structure 2 • Recent social unrest and COVID lockdowns have further strained the global perception of the ‘ investability ’ into Chinese - owned entities Macro Economic Environment is Causing Significant Distress to CIH Customers • Increasing global interest rate environment is causing a negative impact on global real estate • Recent market conditions in China has resulted in high - profile credit quality deterioration, including defaults and bankruptcies, by Chinese real estate developers • T he default rate (actual default plus technical default) of Chinese real estate USD bonds has risen to over 50 % . Over 50 % of these bonds have fallen to below $ 30 as of November 23 , 2022 3 Microenvironment for CIH is Deteriorating • CIH’s customer trends demonstrate a progressive and significant deterioration in customer revenues and revenue visibility ; the Company forecasts a more than 57 % decrease in its revenues by 2025 from its 2020 peak • In FY 21 , the Company’s NI margin was 45 % . A deteriorating business environment has continued to pressure margins . The Company projects NI margins to decrease to ~ 22 % by FY 25 with gross, operating, and EBITDA margins are forecasted to decrease in future periods as well • CIH received a delisting notice from Nasdaq on June 1 , 2022 Transactional Considerations • Buyer consortium represents approximately 82 % of Company ownership and 95 % of voting control through an A - B share structure • Precedent 13 - D transactions provide a significant reference of CIH ADS value 1) Source: USCC.gov , September 30, 2022 bulletin 2) Source: Maples Group, Analysis and Insights, “An Offshore Perspective on the impact of new US - PRC Laws on China VC”, August 5, 2 022 3) Source: iFast Reasearch Team, BondSupermart “A List of 30 of 30 Key Chinese Developers’ Latest Development (Ongoing Update)” 11/23/22 |
| 16 STRICTLY PRIVATE AND CONFIDENTIAL Company Business Description Leju Holdings Limited Provides online to offline (O2O) real estate services in the People's Republic of China Urbanimmersive Inc. Develops and commercializes real estate photography technologies and services in Canada P.E. Analytics Limited P.E. Analytics Limited owns and operates PropEquity, an online subscription based real estate data and analytics platform e-Seikatsu Co.,Ltd. Operates as a real estate technology company in Japan Property Data Bank Property Data Bank, Inc. provides Internet-based application solutions Doma Holdings Inc. Originates, underwrites, and provides title, escrow, and settlement services to homeowners, lenders, title agents, and real estate professionals Voxtur Analytics Corp. Operates as a real estate technology company Douglas Elliman Inc. Engages in the real estate services and property technology investment business in the United States Fang Holdings Limited Fang Holdings Limited operates a real estate Internet portal in the People’s Republic of China E-House Enterprise Holdings Offers real estate agency, real estate data and consulting, and real estate brokerage network services Compass, Inc. Compass, Inc. provides real estate brokerage services in the United States Redfin Corporation Operates as a residential real estate brokerage company in the United States and Canada Anywhere Real Estate Inc. Provides residential real estate services in the United States and internationally Zillow Group, Inc. A digital real estate company, operates real estate brands on mobile applications and websites in the United States China Index Holdings Together with its subsidiaries, operates a real estate information and analytics service platform in China Source: Capital I.Q. Valuation Analysis Select Public Companies Business Descriptions |
| 17 STRICTLY PRIVATE AND CONFIDENTIAL Closed Date Target Buyer Transaction Value ($M) EV/LTM REV EV/LTM EBITDA Target Description Target Country 04/27/22 Shanghai Tianji Network Shanghai Ziyong IT $46.3 8.4x - Operates online platforms and database for real estate industry China 12/06/21 Virtual Access Tours Urbanimmersive $1.2 2.1x - Virtual Access Tours LP operates as a real estate marketing firm United States 06/04/21 CoreLogic, Inc. Insight Venture $8,021.4 4.8x 15.7x Provides property information, insight, analytics, and data-enabled solutions in North America, Western Europe, and the Asia Pacific United States 02/24/21 YAPO.cl Frontier Digital Ventures $19.4 2.6x 14.2x YAPO.cl SpA operates an online classifieds website for cars and real estate Chile 09/17/20 58.com Inc. General Atlantic $9,681.0 3.8x 9.8x Operates various multi-category online classifieds platforms and vertical listing platforms that enable local businesses and consumers to connect, share information, and conduct business in the People's Republic of China China 04/28/20 MZN Property Ringier Axel Springer Media $21.5 2.5x 35.7x Operates as a publisher of specialized real estate services in Poland and internationally Poland 10/31/19 Invest Online, Inc. Aeria Investment $5.6 0.6x - Invest Online, Inc. operates an online portal that provides information for real estate investments to investors. Japan 12/12/18 Meyers Research Kennedy-Wilson $48.0 3.0x - Provides data and analytics for residential real estate development and new home construction United States 12/07/18 Fairfax Media Limited Nine Entertainment $1,934.1 1.5x 11.4x Fairfax Media Limited operates as a multi-platform media company in Australia and New Zealand. Australia 10/24/18 Excite Japan Co. XTech Corporation $47.9 0.4x - Operates an online portal that offers online searching service, e-mail, blog, weather information, subway navigation, and news Japan 10/12/18 Reis Moody's Corp. $278.0 5.5x 37.8x Provides commercial real estate market information and analytical tools to real estate professionals in the United States United States 02/20/18 Digitree Group Polinvest 7 $10.5 1.1x 8.9x Provides advertising services in Poland and internationally Poland Min $1.2 0.4x 8.9x 25th PCTL $17.2 1.4x 10.6x 33rd PCTL $20.8 1.9x 11.4x Median $47.1 2.6x 14.2x Mean $1,676.2 3.0x 19.1x 66th PCTL $124.7 3.3x 15.7x 75th PCTL $692.0 4.0x 25.7x Max $9,681.0 8.4x 37.8x China Index Holdings 1 $16.4 0.6x 1.4x Together with its subsidiaries, operates a real estate information and analytics service platform in China China Source: Capital IQ Projected financials based on median analyst estimates. All precedent transactions included are control transactions Acquisitions of majority stake internationally from 12/20/17 to present, relating real estate advertising, analytics, insight and online marketplaces 1) China Index Holdings metrics are derived from the $1.00 per ADS offer price and information provided by Management Valuation Analysis Select Precedent Transactions |
| 19 STRICTLY PRIVATE AND CONFIDENTIAL WACC Calculation Step 1 - Calculate Average Portfolio Beta (a) Calculated Average Portfolio Equity Beta 0.73 Step 2 - Unlever Portfolio Beta (b) Average Debt-to-Equity Ratio 83.8% Average Tax Rate 25.9% Unlevered Average Portfolio Equity Beta 0.73 Step 3 - Arrive at CIH Equity Beta Unlevered Average Portfolio Equity Beta 0.73 CIH Debt-to-Equity Ratio (c) 5.3% CIH Tax Rate (d) 23.9% CIH Implied Equity Beta 0.69 Step 4 Risk Free Rate (e) 4.2% Equity Risk Premium (f) 7.5% Levered Equity Beta 0.69 Cost of Equity Capital (g) 9.4% Size Premium (h) 11.2% CIH Adjusted Cost of Equity Capital 20.5% Step 5 Debt-to-Capital Ratio 5.1% Equity-to-Capital Ratio 94.9% Pre-tax Cost of Debt (i) 8.5% After-tax Cost of Debt 6.5% Cost of Equity Capital 20.5% Weighted Average Cost of Capital (j) 19.8% Valuation Analysis Discounted Cash Flow – WACC Calculation a) Beta was found using Capital IQ. Only comparable companies that had a minimum of 60 months of trading history were used. Capital IQ calculates beta on a monthly basis. Roth uses mid - year conventions to discount cash flows as Roth assumes that cash flows come in continuously throughout the year. Assumes a valuation date of 01/01/23 b) B(u) = B(l) / (1+(1 - Tax Rate) x Debt - to - Equity) c) Assumes debt of $ 4.9m . Further assumes this amount of leverage persists as the Company's target leverage ratio d) Effective tax of 23.9% per Management - provided financials, LTM average e) Source: Spot 2 - year Treasury yield at 12/19/22 f) Source: 2022 Kroll Cost of Capital Module; Historical long term (1926 - 2021) g) CAPM Cost Equity Capital Calculation: Risk Free Rate + (Equity Beta x Equity Risk Premium) h) Source: 2022 Kroll Cost of Capital Module; 10z Decile i) BofA High Yield Index at 12/19/22 j) Weighted Average Cost of Capital = (Debt - to - Capital x Cost of Debt x (1 - Tax Rate)) + (Equity - to - Capital x Cost of Equity Capital) |
| 20 STRICTLY PRIVATE AND CONFIDENTIAL Levered Equity Unlevered Beta Debt Value Tax Rate Beta Leju Holdings Limited LEJU 1.05 $22.8 $19.7 NM NM P.E. Analytics Limited PROPEQUITY NM $0.0 $18.0 22.6 NM Urbanimmersive Inc. TSXV:UI 0.98 $3.0 $7.0 NM NM e-Seikatsu Co.,Ltd. 3796 0.50 $0.0 $23.7 35.0 0.5 Property Data Bank 4389 1.23 $0.0 $79.0 29.4 1.2 Doma Holdings Inc. DOMA NM $180.5 $135.0 NM NM Voxtur Analytics Corp. VXTR 0.68 $45.2 $102.2 NM NM Douglas Elliman Inc. DOUG NM $149.5 $307.9 21.1 NM Fang Holdings Limited SFUN.Y NM NM NM NM NM E-House Enterprise Holdings 2048 (0.08) $909.2 $141.5 NM NM Compass, Inc. COMP NM $622.5 $1,010.3 NM NM Redfin Corporation RDFN 1.84 $1,757.0 $520.9 NM NM Anywhere Real Estate Inc. HOUS 2.18 $3,548.0 $740.1 21.6 0.5 Zillow Group, Inc. ZG 1.53 $1,875.0 $7,766.5 NM NM Average 1.10 $701.0 $836.3 25.9 0.73 Levered Beta & WACC Calculation ($ in millions) Unlevered Equity Levered Beta Debt Value Tax Rate Beta China Index Holdings Limited CIH 0.73 $4.9 $92.0 23.9% 0.69 Name Ticker Valuation Analysis Discounted Cash Flow – Beta Derivation 1,2,3,4 1) Beta was found using Capital IQ; 12/20/22 . Only comparable companies that had a minimum of 60 months of trading history were used. Capital IQ calculates beta on a monthly basis 2) LTM Effective tax rate; NM if tax rate is less than 0 3) Unlevered betas equal to 0.00 and Fang Holdings Limited are NM 4) CIH Equity Value is derived using the $1.00 proposed per ADS offer price and shares outstanding provided by Management |
| 26 STRICTLY PRIVATE AND CONFIDENTIAL III. Appendix |
| 28 STRICTLY PRIVATE AND CONFIDENTIAL Appendix CIH Balance Sheet (USD in actuals) (USD$ in actuals) 12/31/17 12/31/18 12/31/19 12/31/20 12/31/21 09/30/22 1 Cash & ST Investments $33,206,457 $23,584,990 $48,702,842 $96,525,782 $51,926,707 $54,640,815 Receivables 1,191,444 2,231,211 3,482,119 4,263,057 9,679,208 10,398,527 Prepaid Exp. 53,001 99,538 655,833 - - 4,380,837 Other Current Assets - 282,959 692,316 811,101 1,057,146 - Current Assets 34,450,902 26,198,698 53,533,110 101,599,941 62,663,062 69,420,179 Net Property, Plant & Equipment 728,943 564,769 7,536,189 6,709,719 5,790,748 5,596,555 Deferred Tax Assets, LT - - - 219,473 354,632 - Other Long-Term Assets - - - 250,210 250,354 807,223 Assets $35,179,845 $26,763,467 $61,069,299 $108,779,343 $69,058,796 $75,823,958 Accounts Payable 530,009 744,599 1,126,665 1,341,972 1,646,764 2,259,076 Accrued Exp. 6,752,091 8,499,686 8,788,964 9,053,538 7,989,929 13,497,143 Short-term Borrowings 547,964 - - - 2,605,664 - Curr. Income Taxes Payable 3,247,277 2,079,820 3,360,461 3,840,342 3,658,933 1,544,353 Unearned Revenue, Current 19,801,383 20,576,145 29,233,972 32,194,268 31,051,947 24,522,633 Other Current Liabilities 566,923 3,021,485 4,423,065 82,563,265 5,485,239 - Current Liabilities 31,445,648 34,921,734 46,933,128 128,993,386 52,438,475 41,823,204 Long-Term Leases - - 5,411,985 3,939,450 4,247,257 4,936,413 Def. Tax Liability, Non-Curr. - - - 8,911,628 - - Other Non-Current Liabilities - 2,225,752 5,710,457 8,035,317 10,813,917 11,533,667 Liabilities 31,445,648 37,147,487 58,055,570 149,879,781 67,499,649 58,293,284 Common Equity 3,734,197 (10,384,020) 3,013,729 (41,287,019) 1,363,087 17,312,924 Minority Interest - - - 186,581 196,060 217,749 Equity 3,734,197 (10,384,020) 3,013,729 (41,100,438) 1,559,147 17,530,673 Liabilities And Equity $35,179,845 $26,763,467 $61,069,299 $108,779,343 $69,058,796 $75,823,958 Source: Information provided by Management and Form 20 - F Filings; 0.143634 RMB to USD Fx spot rate as of 12/20/22 1) Unaudited |
Exhibit (f)(2)
Rights of dissenters
238. (1) A member of a constituent company incorporated under this Act shall be entitled to payment of the fair value of that person’s shares upon dissenting from a merger or consolidation.
(2) A member who desires to exercise that person’s entitlement under subsection (1) shall give to the constituent company, before the vote on the merger or consolidation, written objection to the action.
(3) An objection under subsection (2) shall include a statement that the member proposes to demand payment for that person’s shares if the merger or consolidation is authorised by the vote.
(4) Within twenty days immediately following the date on which the vote of members giving authorisation for the merger or consolidation is made, the constituent company shall give written notice of the authorisation to each member who made a written objection.
(5) A member who elects to dissent shall, within twenty days immediately following the date on which the notice referred to in subsection (4) is given, give to the constituent company a written notice of that person’s decision to dissent, stating —
(a) that person’s name and address;
(b) the number and classes of shares in respect of which that person dissents; and
(c) a demand for payment of the fair value of that person’s shares.
(6) A member who dissents shall do so in respect of all shares that that person holds in the constituent company.
(7) Upon the giving of a notice of dissent under subsection (5), the member to whom the notice relates shall cease to have any of the rights of a member except the right to be paid the fair value of that person’s shares and the rights referred to in subsections (12) and (16).
(8) Within seven days immediately following the date of the expiration of the period specified in subsection (5), or within seven days immediately following the date on which the plan of merger or consolidation is filed, whichever is later, the constituent company, the surviving company or the consolidated company shall make a written offer to each dissenting member to purchase that person’s shares at a specified price that the company determines to be their fair value; and if, within thirty days immediately following the date on which the offer is made, the company making the offer and the dissenting member agree upon the price to be paid for that person’s shares, the company shall pay to the member the amount in money forthwith.
(9) If the company and a dissenting member fail, within the period specified in subsection (8), to agree on the price to be paid for the shares owned by the member, within twenty days immediately following the date on which the period expires —
(a) the company shall (and any dissenting member may) file a petition with the Court for a determination of the fair value of the shares of all dissenting members; and
(b) the petition by the company shall be accompanied by a verified list containing the names and addresses of all members who have filed a notice under subsection (5) and with whom agreements as to the fair value of their shares have not been reached by the company.
(10) A copy of any petition filed under subsection (9)(a) shall be served on the other party; and where a dissenting member has so filed, the company shall within ten days after such service file the verified list referred to in subsection (9)(b).
(11) At the hearing of a petition, the Court shall determine the fair value of the shares of such dissenting members as it finds are involved, together with a fair rate of interest, if any, to be paid by the company upon the amount determined to be the fair value.
(12) Any member whose name appears on the list filed by the company under subsection (9)(b) or (10) and who the Court finds are involved may participate fully in all proceedings until the determination of fair value is reached.
(13) The order of the Court resulting from proceeding on the petition shall be enforceable in such manner as other orders of the Court are enforced, whether the company is incorporated under the laws of the Islands or not.
(14) The costs of the proceeding may be determined by the Court and taxed upon the parties as the Court deems equitable in the circumstances; and upon application of a member, the Court may order all or a portion of the expenses incurred by any member in connection with the proceeding, including reasonable attorney’s fees and the fees and expenses of experts, to be charged pro rata against the value of all the shares which are the subject of the proceeding.
(15) Shares acquired by the company pursuant to this section shall be cancelled and, if they are shares of a surviving company, they shall be available for re-issue.
(16) The enforcement by a member of that person’s entitlement under this section shall exclude the enforcement by the member of any right to which that person might otherwise be entitled by virtue of that person holding shares, except that this section shall not exclude the right of the member to institute proceedings to obtain relief on the ground that the merger or consolidation is void or unlawful.
2
Exhibit 107
Calculation of Filing Fee Tables
Schedule 13E-3
(Form Type)
CHINA INDEX HOLDINGS LIMITED
(Name of the Issuer and Name of Person Filing Statement)
Table 1 – Transaction Value
Transaction | Amount of | |||||||||||
Valuation | Fee Rate | Filing Fee | ||||||||||
Fees to Be Paid | $ | 14,831,699.00 | (1) | 0.0001102 | (2) | $ | 1,634.46 | (2) | ||||
Fees Previously Paid | — | — | ||||||||||
Total Transaction Valuation | $ | 14,831,699.00 | ||||||||||
Total Fees Due for Filing | $ | 1,634.46 | ||||||||||
Total Fees Previously Paid | — | |||||||||||
Total Fee Offsets | — | |||||||||||
Net Fee Due | $ | 1,634.46 |
(1) | Calculated solely for the purpose of determining the filing fee in accordance with Rule 0-11(b)(1) under the Securities Exchange Act of 1934, as amended. The filing fee is calculated based on the aggregate cash payment for the proposed per-share cash payment of US$1.00 for 14,831,699 outstanding shares of the issuer (including shares represented by ADSs) subject to the transaction as of January 13, 2023. |
(2) | The amount of the filing fee calculated in accordance with the Exchange Act of 1934 equals $110.20 for each $1,000,000 of transaction value. The filing fee was calculated in accordance with Rule 0-11 under the Exchange Act. |