ELong Posts Loss; Receives Going Private Proposal From Tencent

(RTTNews) - eLong Inc (LONG), a mobile and online travel service provider in China, reported a net loss of 356.4 million renminbis ($57.5 million) for the second quarter, compared with a profit of of 31.5 renminbis million last year.

Loss per American depositary share for the quarter was 9.82 renminbis ($1.58), compared with a profit of 0.88 renminbis ($0.14) a year ago, the company said.

Analysts polled by Thomson Reuters estimated a loss of $0.61 per share for the quarter. Analysts' estimates typically exclude special items.

The company's net revenues for the quarter were lower at 218.5 million renminbis ($35.2), compared with RMB 292.4 million renminbis a year ago.

Analysts estimated revenues of $41.6 million for the quarter.

Gross margin for the quarter fell to 39% from 76% in the prior year.

Separately, eLong said it received a preliminary non-binding proposal from Tencent Holdings Ltd for a going private transaction.

As per the proposal, Tencent has proposed to buy all outstanding ordinary shares of eLong not beneficially owned by TCH Sapphire Ltd, a subsidiary of Tencent, for $18 in cash per American depositary share.

The proposed price represents a premium of about 24.1% to the closing trading price of the eLong's ADS on July 31.

eLong said its board plans to form a special committee composed of independent and disinterested directors to consider Tencent's proposal.

Tencent's proposal is conditioned upon the majority stockholders agreeing to support, and to roll their existing equity in the company into, the transaction.