What’s next after the Changyou dividend and Sohu liquidation?

Changyou's recently distributed special dividend and Sohu's pending liquidation may be intended to facilitate a new buyout offer for Changyou.  Fair value for a transaction should be at least $29.74/ADS. Some additional background was in my prior articles: Changyou’s Buyout Price Should be Raised to at least $53  Sohu Valuation enhanced by successful Sogou IPO and … Continue reading What’s next after the Changyou dividend and Sohu liquidation?

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Sohu Valuation enhanced by successful Sogou IPO and potential Changyou privatization

Successful IPO of the Sogou search business clarifies the $1.5Bn value of Sohu's retained 33% stake ($39/share of SOHU) Possible privatization of the Changyou gaming business would deliver $1.4Bn of net cash before tax ($35/share of SOHU) at the unfair preliminary offer price or $1.8-3.2Bn ($45-$82/Share of SOHU) at fair value Sohu has minimal debt, … Continue reading Sohu Valuation enhanced by successful Sogou IPO and potential Changyou privatization

Changyou’s Buyout Price Should be Raised to at least $53

2/1/18 Update: Liquid Assets (cash+investments+loan) at 12/31/17 were $1127mm or $21.06/ADS.   Chairman Charles Zhang offered to acquire all outstanding shares of Changyou at a price of $42.10/ADS The offered price is significantly below the average valuations of competing companies (27.7 P/E for US/HK listed and 36.9 P/E for China listed) The offered price does not … Continue reading Changyou’s Buyout Price Should be Raised to at least $53

Thoughts on the impact on Sohu of a possible Sogou IPO

Bloomberg reports China’s Sogou Targets $5 Billion IPO to Chase Rival Baidu.  Here's a quick look at what an IPO at this valuation would mean for Sohu which currently owns 38% of Sogou. SOHU has three main businesses: Media Portal, including sohu.com focus.cn and 17173.com.  These businesses reported an operating loss of $136mm in 9M16.  Advertising … Continue reading Thoughts on the impact on Sohu of a possible Sogou IPO