(Yicai Global) Nov. 17 -- Hangzhou Ali Venture Capital plans to buy a 5.26 percent stake in radio and TV broadcaster Mango Excellent Media from state-backed Mango Media, spending at least CNY6.2 billion (USD940 million) to become its second-largest shareholder if the deal goes through.

A working group will be set up as soon as possible to review materials submitted by Ali Venture Capital, which is the investment arm of tech titan Alibaba Group Holding, and determine the ultimate transferee, per Mango Media’s requirements. Whether Ali Venture Capital can pass muster and clinch the deal is still up in the air, Mango Excellent Media announced yesterday.

The company’s shares [SHE:300413] closed 2.85 percent down at CNY68.20 (USD10.32) at noon today.

Its parent Changsha, Hunan province-based Mango Media, which is owned by the provincial government, planned to transfer its holding of 93.65 million unrestricted tradable shares in Mango Excellent Media via an open and public solicitation of buyers of 5.26 percent of the firm's total shares for at least CNY66.23 per share, the company previously announced.

The taker will have to observe a lockup period of no less than 12 months after the transfer and its total assets and net assets in the most recent annual consolidated financial statement must have been no less than CNY100 billion (USD15.13 billion) and CNY50 billion, respectively.

Flocking Together

The enterprise group controlled by the transferee or its actual controller must also have been profitable for the last three fiscal years, with respective revenue and net profit in the most recent year of no less than CNY50 billion and CNY5 billion, per the announcement.

The purchaser must also have solid, strong operational capability and be active in fields of relevance to or in synergy with those of Mango Media. Scope is present for in-depth cooperation with listed companies in content production, artist resources, content live streaming and online retail.

Changsha-headquartered Mango Excellent Media is a new mainstream media group. It doubled its share price this year from the popularity of its hit variety show ‘Sisters Who Make Waves,’ peaking at CNY81.73 in October.

Mango Excellent Media rang up CNY9.471 billion in revenue in the first three quarters, up 15.05 percent from the same period last year, and net profit of CNY1.612 billion in a yearly 65.39 percent rise.

Editor: Ben Armour, Xiao Yi