Hurray! News
Hurray! to Make Strategic Investment
in Huayi Brothers Music
BEIJING, December 13, 2005 /Xinhua-PRNewswire/ -- Hurray! Holding
Co., Ltd. (Nasdaq: HRAY - News), a leader in advanced wireless value-added
services, music production and distribution, and mobile telecommunication
network software in the People’s Republic of China, today announced
the signing of definitive agreements to make a strategic investment
in Huayi Brothers Music Co., Ltd. (“Huayi Brothers Music”). The
Huayi Brothers group of companies have a well known brand name in
China for movie and music production. Huayi Brothers Music is a
subsidiary which focuses on artist development, music production
and offline distribution of music in China. Its portfolio of artists
includes some of the most popular singers in China, such as Yu Quan
and Huang Zheng. Yu Quan’s album received the “Best Album of 2005
in China” award at the CCTV-MTV Music Awards in July 2005.
As part of the agreement, Hurray! will invest a total of $4.3 million
in cash for 51% of Huayi Brothers Music. The final consideration
payable by Hurray! and the respective ownership interests of the
shareholders of Huayi Brothers Music are subject to adjustment based
on the financial performance of Huayi Brothers Music following the
closing of the transaction. The transaction is expected to be accretive
to Hurray!’s earnings per share.
Hurray! currently expects the transaction to close before January
31, 2006, subject to required China regulatory approval and other
customary closing conditions. Upon closing, pursuant to certain
contractual arrangements, Hurray! will distribute Huayi Brothers
Music's music via wireless and Internet platforms, and Huayi Brothers
Music will continue to distribute such music via offline channels,
such as music stores.
Commenting on this announcement, QD Wang, Chairman and Chief Executive
Officer of Hurray!, said, "We are very pleased to announce
this strategic investment in Huayi Brothers, which we believe is
the best brand name in the entertainment industry in China. We believe
that Huayi Brothers Music is especially attractive because its strong
market position and comprehensive business operations enable it
to attract some of the most popular singers in China."
Mr. Wang continued, "Moreover, music has become the most popular
category of wireless value-added services in China, and we expect
it to continue gaining in popularity in the future. With this investment
and the previously announced partnership with the music business
of the Freeland group, we believe that we are building the largest
music production and traditional and digital distribution house
in China."
"Combining Huayi Brothers’s powerful brand name and special
music expertise with Hurray!’s strong digital and mobile production
and distribution capabilities, we believe that we are redefining
the traditional music industry, and creating a totally new business
model in China. We expect that this will provide us with a solid
foundation for long-term, sustainable growth." added Zhongjun
Wang, founder and General Manager of Huayi Brothers Music.
China eCapital served as financial advisor to Hurray! in the transaction.
About Hurray! Holding Co., Ltd.
Hurray! provides wireless value-added services such as ringtones,
picture downloads, community and entertainment services to mobile
users in China. The company is one of the market leaders in providing
these services using wireless application protocol, commonly referred
to as WAP, in China. WAP services are offered through the advanced
2.5G mobile networks, the most advanced broadly available mobile
networks deployed in China. Hurray! also offers these services through
2G mobile networks. In addition, Hurray! focuses on music production
and distribution.
Hurray! also designs, develops, sells and supports a service provisioning
and management software that is used by China Unicom, one of the
two principal mobile operators in China, to support its 2.5G services
platform.
About Huayi Brothers Music
The Huayi Brothers group of companies have a well known brand name
in China for movie and music production. Huayi Brothers Music is
a subsidiary which focuses on artist development, music production
and offline distribution of music in China. Recently, it received
the mandate to produce music for Zhang Liangying, who successfully
emerged from “Super Girl,” a highly popular Chinese television music
competition.
Forward-looking Statements
This press release contains statements of a forward-looking nature.
These statements are made under the "safe harbor" provisions
of the U.S. Private Securities Litigation Reform Act of 1995. You
can identify these forward-looking statements by terminology such
as "will," "expects," "anticipates,"
"future," "intends," "plans," "believes,"
"estimates" and similar statements. The accuracy of these
statements may be impacted by a number of business risks and uncertainties
that could cause actual results to differ materially from those
projected or anticipated, including: the risk that this or any future
acquisition will not create the operational and financial results
that the management and board of directors of Hurray! and Huayi
Brothers expect, including in particular the possibility that this
acquisition may not be accretive to earnings in any future period
or that Huayi Brothers will not continue to be able to attract popular
music artists in China; the risk that Hurray! will not be able to
effectively manage Huayi Brothers Music' artists or effectively
utilize its library of music; the risk that the popularity of music-related
wireless value-added services will not continue to grow or that
it may decrease; the risk that this and any future acquisition could
divert management's attention from Hurray!'s operations, which could
adversely affect its results of operations; and the risks outlined
in our filings with the Securities and Exchange Commission, including
our registration statement on Form F-1. We do not undertake any
obligation to update this forward-looking information, except as
required under applicable law.
For more information, please contact:
Phoebe Meng
Investor Relations Manager
Tel: 8610-6518-8989 ext 6806
yfmeng@hurray.com.cn
SOURCE: Hurray! Holding Co., Ltd.
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