How do we get this going ? If Softbank throws in their equity into Chen's going private scam, do we have a choice other than SB losing reputation ?
We all agree RENN owns a billion worth of IPO stock... SoFi etc..
Buy RENN stock and offer to Buy out the rest of the shares (including CHEN's) for $5.00 to $6.00 per share.
If you succeed, you can break Renn up and make a BILLION. If you don't then SoFi goes public and RENN stock holders make a ton. In which case you only make a hundred million. Or if CHEN still wants to take RENN you can sell him your shares at $5.50 (Greenmail) WIN WIN
Sorry you lost all your money. Pizza hut are hiring delivery people. Dont hang yourself many people have started over. Lmaoau
the owner can do almost anything.
this is an old article by lfcj.org
A “pyramidal” structure is common in family-dominated companies. Legally independent companies are controlled by the same family through a chain of ownership relations. The controlling shareholder — usually one who owns at least 20 percent of a company’s voting rights — exercises control of one company through ownership of at least one other listed company.
Such companies can operate legally and ethically, but that kind of structure led U.S. investors to be wary when Chinese Internet company Renren Inc. floated an IPO on the New York Stock Exchange in 2011.
As the investor website Motley Fool pointed out, the company offering shares in Renren was a Cayman Islands-based holding company. The operating company for Renren in China was actually Beijing Qianxiang Tiancheng Technology Development, which would continue to be 99 percent owned by the Renren CEO’s wife, a Chinese citizen.
A dual-class share structure, in which some shares have voting rights and others do not, also limited the influence of outside shareholders — a typical situation in family-dominated companies.
Despite those and other warning signs, Renren (RENN) raised $740 million at $14 per share.
The success of the IPO indicated that even red flags do not deter investors who think they have spotted a high-flying company. Soon, however, investor concern over accounting practices at Chinese firms took a toll on Renren, among other Chinese companies, and its share price dipped to $4.05 in early 2012.
Here is why I believe Renren should be valued north of 10 USD and the 4.2 Offer from Mr. Chen is a COMPLETE JOKE. I believe he did everything to hide the real value of the invests he did. According to me - Renn should be valued like a CMGI in the past.
Renren through its Investment Arm Lianhe Holdings did some pretty smart investments into some disruptive technology.
Info last conf. call: Through the first quarter of 2015, they have invested a total of 275 million in long strategic investments. The majority of these investments are in Internet finance and O2O companies with synergies to their Internet finance operations. Now they have a portfolio of affiliates and some of the most innovative Internet finance companies in both U.S. and China
Here is some info I have found, not sure if all correct all (some info also from Michael #$%$, see onto seekingalpa) – of course there are more investments RENN did.
SOCIALFINANCE: Invested in series B,D,E rounds for 25% in SOFi (Socialfinance), a company which in my opinion could easily grow into a 5 Bn valuation(2 years from now?), considering they are number 2 after Lendigtree in the market.
=1.25 Billion for Renn
LENDINGHOME: Invested in Series D for 15% in LendingHome – a very fast growing fintech co. , implied valuation 390 mio USD, so it its every ones guess what lendinghome could be worth 3 years from now – 1 bn???
=200 mio for Renn
MOTIF: Pretty new broker service, growing very fast. Invested in Series E for a 10% stake in MOTIF, implies a valuation of 400 mio. Other Investors G. Sachs, JP Morgan…, so it its every ones guess what lendinghome could be worth 3 years from now – 1 bn???
=100 mio for Renn
CHEYIPAI: Leading! Used car platform in China – google for it! Renn invested in series D for a 20% stake. Implies a valuation of 390 mio USD. What could this company be worth – I mean they have more than 50% market share according to my info in used car sales – by the way, Sequoia capital also did invest. Could this co be worth 1 bn 3 years from now?
= 200 mio USD for Renn
SNOWBALL finance: Leading Chinese finance portal – they did invest 40 mio USD, not sure what stake renn has
= XXX for Renn
YIKYAK: Renren did invest very very early, but I do not have info on how much share they do have. However YIK YAK is HOTTT and the last investment round valued yik yak at 400 mio usd.
= XXX for Renn
GOGOVAN: Renn owns 10% in this “Uber” of logistics. Check out all the gogovan sides. They are expanding RAPPIDLY in Singapore, Taiwan … and concentrate on Korea and China. The China side is open. Considering the “Uber Valuation of 50 bn usd, or Grabtaxi in asia which is valued 1bn usd…), gogovan has a long way to grow here – I love this one! Could this one also be valued 1 bn in the future – or even much more? Search for Gogovan onto Google.
=100 Mio USD for RENN
TRUCKERPATH: Renn did invest very early into truckerpath – the leading trucker app in the us, 250.000 users, growing 20% a month. The recently opens a marketplace – check out the webpage – new disruptive technology for the trucking industry.
= XXX for Renn
TALECH: A pretty nice and innovative POS solution – check out their webpage. I have no info how much renn did invest here or how much share they have, but Renn is onto the webpage as investor listed.
= XXX for Renn.
FUNDRISE (leading capital real estate market place – check out the growing user numbers daily, by checking there webpage.
= XXX for RENN
MAPBAR: Mapping provider in China…. I think Renren has 30% share – not sure
= XXX for Renn
Coming to the operational part – Renn stated in the last conf. call, that the worst is over and the restructuring did work out well. Woixu is making money, as does games… Besides HE IS INVESTING into FINTECH – CHECK out Renren Licai (search in google for Renren licai) the side is open (in beta), this is sort of the “Lendingtree business” of china. Renren's Fenqi, is going very wellllll etc etc. I believe in some quarters Renn will make money on the operative side…!
Also I guess they will replicate some of the business models from their US investments.
Cash on hand according to last conf. Call info: 413 MIO USD
In sum – only the listed info above – Investments + Cash on hand + Operative side? =I come to 2.5 bill Valuation! = ca. 8-10 USD a share, depending what other investments you add… etc etc. – NOT even thinking what could be 5 years from now!
1. softbank is not in the same boat as small retail investors (there must be a different deal for soft bank)
2. chen is always wishing the stock price is lower so he could buy it cheap.
3. there seems not a lot things small investors can do to stop the buyout
4. small investors should feel lucky if chen made offer couple of months ago when renn was trading in $2 range
5. chen want to buy out the company now because if Sofi goes public it would cost him more
so what can a small retail investors do?
I did. All 400 pages. I also read the initial IPO offering when they went public. When you read it you know exactly what Chen was planning to do. It states numerous times (almost to the point of being taunting) that if investors want to sue them it could be very difficult due to their structure (VIE's, off shore entities, etc.). AND, if that is not enough, the main entity within RENN is owned and controlled by guess who? Joe Chen's wife. Yep. So he can just put this entity to his wife if things get real bad. The guy has a degree if physics from a US university. An MBA from Stanford. He is not stupid.
On numerous occasions in the past few months I have asked the question (with no answer from anyone) as to whether or not RENN can make some sort of side deal with Softbank and DCM that is not the same deal offered to other investors. If he can than he most certainly already has. If he cannot, then I don't know how Softbank and DCM possibly would go along with this.
So what is the legal angle since its a Chinese company with offshore entities, etc? The legal angle is that their most valuable assets are their investments in U.S. based companies (SoFi). That could possibly make things a lot more sticky. During the IPO road show when people asked him about all the stuff I outlined in paragraph 1 he said that "his kids went to U.S schools.....and he would never do anything that would prevent him from being able to come to the U.S.....blah blah blah". Plus, I am fairly certain that he is NOT a Chinese national.
So I guess we will see.