Harbin Electric (NASDAQ:HRBN)

HARBIN, China, Nov. 1, 2011 /PRNewswire/ -- Harbin Electric, Inc. ("Harbin Electric" or the "Company"; NASDAQ: HRBN), a leading developer and manufacturer of a wide array of electric motors in the People's Republic of China, today announced it has commenced the closing process of the merger contemplated by the Agreement and Plan of Merger, dated June 19, 2011, as amended, pursuant to which the Company will become a wholly-owned subsidiary of Tech Full Electric Company Limited ("Tech Full Electric"), which is controlled by Mr. Tianfu Yang, the Company's Chairman and Chief Executive Officer.

As part of the closing process, the Company has filed the Articles of Merger with the Nevada Secretary of State.  Trading of the Company's common stock has been suspended on the NASDAQ Global Select Market as of market close today.  NASDAQ has filed a notification of removal of listing and registration on Form 25 with the Securities and Exchange Commission ("SEC") with respect to Harbin Electric's common stock.  

As previously announced, at the Company's Special Meeting of Shareholders held on October 29, 2011, the Merger Agreement was approved by approximately 90.6% of the outstanding shares of Harbin Electric common stock and approximately 84.2% of total unaffiliated shares of Harbin Electric, satisfying the majority of unaffiliated stockholders voting requirement set forth in the Merger Agreement.  

Due to the multi-jurisdictional nature of Harbin Electric and different time zones involved in the closing process, the Company currently anticipates the "going private" transaction will be completed on November 2, 2011 (U.S. time).  The Company intends to publicly announce when the closing of the transaction is completed.

In its report dated October 14, 2011, ISS stated:

• "The merger consideration provides shareholders with a significant premium in an all-cash transaction which carries certainty of value."*
• "The board and Special Committee undertook a robust strategic review process, taking prompt action to mitigate potential conflicts of interest that arose during the strategic process."*
• "Shareholder support for this transaction is warranted."*

The Company issued the following statement regarding the ISS recommendation.  See more

On October 5, 2011, the parties to the Nevada Action entered into a Memorandum of Understanding (the “MOU”) to settle the Nevada Action. The MOU includes an agreement by the parties to the merger agreement to amend Section 7.3(b) of the merger agreement to reduce the Company termination fee from $22.5 million to $19.75 million and an acknowledgment by the Company that Co-Lead Counsel were a significant causal factor in the Company’s decision to make certain additional disclosures in its preliminary proxy statements filed on Schedule 14A with the SEC on August 15, 2011, August 29, 2011, and September 13, 2011. The MOU also provides for dismissal of the Nevada Action and includes releases of the Company, its officers and directors, the members of the Special Committee in their respective capacities as such, and the members of the Buyer Group, among others. The parties to the MOU anticipate preparing a settlement agreement for presentation to the court. The effectiveness of the MOU and any settlement agreement is conditional upon preliminary approval of the Nevada state court and final approval by that court following notice to the class members. In addition, Co-Lead Counsel have the right to seek an award of attorneys’ fees and costs from the Company for the benefit, they contend, they provided the class. Please see the section entitled “Special Factors—Litigation Related to the Merger” on page 82 for a detailed discussion of the litigation.

The fifth paragraph on page 14 of the Definitive Proxy Statement is amended in its entirety to read as follows:

The Nevada and New York complaints generally allege that Mr. Tianfu Yang and other directors breached their fiduciary duties to stockholders by agreeing to sell the Company at a price that is unfair and inadequate, and by failing to inform the stockholders adequately concerning the proposed merger and thus precluding them from casting a fully informed vote. In some cases, the complaints further allege that the Company aided and abetted the directors’ purported breaches of their fiduciary duties. The complaints seek injunctive relief, rescission of the proposed merger to the extent already implemented, damages, and attorneys’ fees. On October 5, 2011, the parties to the Nevada Action entered into the MOU to settle the Nevada Action. The parties to the MOU anticipate preparing a settlement agreement for presentation to the court. The effectiveness of the MOU and any settlement agreement is conditional upon preliminary approval of the Nevada state court and final approval by that court following notice to the class members. Please see the section titled “Special Factors—Litigation Related to the Merger” beginning on page 82 for a detailed discussion of the litigation.

HARBIN, China, June 10, 2011 /PRNewswire-Asia-FirstCall/ -- Harbin Electric, Inc. ("Harbin Electric" or the "Company") (NASDAQ: HRBN) today announced that its Board of Directors has received a letter from its Chairman and Chief Executive Officer, Mr. Tianfu Yang ("Mr. Yang"), and Abax Global Capital ("Abax") reaffirming their proposal to acquire all of the outstanding shares of Common Stock of Harbin Electric not currently owned by Mr. Yang, Abax and their respective affiliates in a going private transaction for $24.00 per share in cash.  Mr. Yang, Abax and their respective affiliates collectively own approximately 40.72% of Harbin Electric's Common Stock.  In addition, Harbin Electric today announced that its Board of Directors has received from Mr. Yang and Abax an executed copy of a Facility Agreement between Tech Full Electric Company Limited ("Tech Full"), the acquisition vehicle formed for use in connection with the proposed acquisition and going private transaction, and China Development Bank Corporation Hong Kong Branch ("CDB"), pursuant to which CDB has agreed to provide to Tech Full a $400 million term loan to fund Tech Full's proposed purchase of all of the outstanding shares of Common Stock of Harbin Electric not currently owned by Mr. Yang, Abax and their respective affiliates, subject to certain conditions.  

Shares of Harbin Electric, Inc. (Nasdaq: HRBN) are moving higher following an amended 13D from the CEO noting a $400 million term loan facility.

From Filing:

On June 9, 2011, Tech Full entered into a facility agreement (the “Facility Agreement”) with China Development Bank Corporation Hong Kong Branch (“CDB”). Under the terms and subject to the conditions of the Facility Agreement, CDB will provide a $400 million term loan facility (the “Loan”) to Tech Full to fund the payment of the acquisition consideration for the proposed purchase of the publicly held shares of the Company and transaction costs and fees in connections therewith. A copy of the Facility Agreement is filed as Exhibit 7.01 and is incorporated herein by reference.