AsiaInfo Holdings, Inc. (NASDAQ: ASIA) filed to withdraw a filing that would have allowed two large insider holders to sell shares. It is a bit complicated, but the long and short of it is that this will keep the float much smaller. At least for now.
The filing today noted that the agreement was originally entered into in connection with CITIC’s and PacificInfo’s acquisition of AsiaInfo stock in 2006 from Warburg Pincus in a privately negotiated transaction. The agreement provided CITIC and PacificInfo with registration rights, provided transfer restrictions during a specified period on the shares CITIC and PacificInfo and provided CITIC with the right to nominate a member of the board of directors, and provided AsiaInfo with a right of first offer to buy back the shares from CITIC or PacificInfo under certain circumstances.
This further noted that AsiaInfo has been engaged in ongoing discussions with CITIC regarding various alternatives for CITIC to sell its shares of Company stock. CITIC and PacificInfo have informed the company that neither currently wish to sell shares pursuant to a registered resale transaction. AsiaInfo has informed CITIC and PacificInfo that it has determined not to repurchase the shares held by CITIC or PacificInfo at this time.
The parties have therefore agreed to terminate the agreement. Based on this development, AsiaInfo withdrew its shelf registration which would have accommodated the public resale of these shares. CITIC currently holds approximately 9.16% and PacificInfo currently holds approximately 5.09%.
It is hard to get overly excited about this sort of canceled offering, but this in theory at least keeps over 14% of the total outstanding shares off of the market and therefor out of the float. Again, for now. AsiaInfo Holdings shares are still up over 2% at $16.90 shortly before the close.
Jon C.Ogg
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