Shandra Games Limited announced they have signed a definitive agreement to acquire affiliates Shanghai Shengzhan Networking Technology Co., Ltd and Tianjin Shengjing Trade Co., Ltd. Shengzhan and Shengjing are leading providers for user and platform services under parent company Shanda Interactive Entertainment Limited.
Tianqiao Chen, Chairman of Shanda Games' Board of Directors, commented, "Through this transaction, the Board aims to strengthen Shanda Games both strategically and financially. The acquisition is a strong step forward in strengthening our mobile business, which now forms an integral part of our strategy."
"Combining our cumulative expertise and resources in the online gaming industry, we will leverage the customer database and distribution channels operated by Shengzhan and Shengjing to build a consolidated mobile game platform," Chen added.
"In addition, this transaction removes two cost components from our cost structure and is projected to improve our EPS by approximately 40-50%," Chen continued. "It puts our large cash position to a much better use and also eliminates two recurring related-party transactions and settles an outstanding loan receivable from Shanda Interactive."
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