BEIJING, March 12 /Xinhua-PRNewswire/ -- Hurray! Holding Co., Ltd. (Nasdaq: HRAY), a leader in wireless music distribution and other wireless value-added services, artist development and music production, and wireless value-added services management software in China, today announced the signing of definitive agreements to acquire a major interest in Beijing Secular Bird Culture and Art Development Center ("Secular Bird"), a music production and offline music distribution record label in China.
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Secular Bird specializes in music production and distribution for its portfolio of artists and many songs produced by Secular Bird and its artists, such as " Autumn Never Comes Back (Qiu Tian Bu Hui Lai)", "Don't Wanna Make You Cry" (Bu Xiang Rang Ni Ku) were top hits in ringtones, ringback tones and full track downloads on mobile and internet platforms in China. "Qiu Tian Bu Hui Lai" not only ranked Number 1 on Baidu's music search platform and China Mobile's mobile music board, but also received the “Most Popular Album in 2006” award at the China Mobile M.Music Awards in January 2007.
In the acquisition, Secular Bird will inject the music business into a newly formed company ("Hurray! Secular Bird"), which upon the closing of the acquisition will be 65% owned by Hurray! and 35% owned by Secular Bird. The total consideration for the acquisition is US$1,480,000 in cash. Consideration payable by Hurray! and the respective ownership interests of the parties in Hurray! Secular Bird is subject to adjustment based on 12-month financial performance of Hurray! Secular Bird following the closing of the acquisition. The transaction is expected to be accretive to Hurray!'s earnings per share in 2007.
Hurray! currently expects the transaction to close before May 1, 2007, subject to required China regulatory approval and other customary closing conditions. Upon closing, pursuant to certain contractual arrangements, Hurray! will distribute Hurray! Secular Bird music via wireless and Internet platforms, and Hurray! Secular Bird will distribute such music via offline channels, such as music stores.
Commenting on this acquisition, QD Wang, Chairman and Chief Executive Officer of Hurray!, said, "We are very pleased to announce this strategic partnership with Secular Bird, a record label with strong music production capability. This takes us one step closer toward our goal of reaching more than 25% music market shares and becoming a leading digital entertainment content production and distribution house in China."
About Hurray! Holding Co., Ltd.
Hurray! is a leading provider of music and music-related products such as ringtones, ringback tones, and truetones to mobile users in China through SMS, IVR, RBT, WAP, MMS and Java wireless value-added services platforms over mobile networks and through the Internet. The company also provides a wide range of other wireless value-added services to mobile users in China, including games, pictures and animation, community, and other media and entertainment services.
In addition, Hurray! is a leader in artist development, music production and offline and online distribution in China through its majority controlled record labels Huayi Brothers Music and Hurray! Freeland Music.
Hurray! also designs, develops, sells and supports a service provisioning and management software for mobile operators in China to manage wireless value-added services.
About Beijing Secular Bird Culture and Art Development Center
Beijing Secular Bird Culture and Art Development Center is an all-around cultural diffusion company in China in artist development, interpretation organization, music production and offline music distribution in China.
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 Secular Bird expect, including in particular the possibility that this acquisition may not be accretive to earnings in any future period or that Secular Bird will not continue to be able to attract popular music artists in China; the risk that Hurray! will not be able to effectively manage Secular Bird's 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.
