Gridsum Stock Doubles on $2 Per Share Buyout Bid

The trouble-ridden company is evaluating a proposal from a group of investors led by its chairman.

Author: Jennifer Chan   

Shares in Gridsum Holding (Nasdaq: GSUM) more than doubled Friday morning, to $1.33 apiece, after the company said it is reviewing a buyout proposal from a group of investors including its chairman.

The Beijing-based company, the stock in which has been on a continuous slide from the level of $2.50 in December to as low as 24 cents per share in March, is facing delisting from the Nasdaq Stock Market.

Apparently, its chairman and chief executive, Guosheng Qi, sees privatization as his company's best way out. In a statement today, Gridsum said Qi and chief operating officer Guofa Yu, as well as their respective affiliated entities, Beta Dynamic, Shenzhen Qianhai Banyan Capital Investment & Management Co., and Hangzhou Yutao Capital Co., have proposed to acquire all outstanding American depositary shares in GSUM for $2 each.

The bid follows an earlier proposal from a consortium, headed by Qi and Yu. In July 2019, the group offered to buy GSUM shares for $3.80 per ADS – at the time, the stock in the company was trading near the level of $3.

Gridsum has retained a new financial advisor to evaluate the bid.

Gridsum provides cloud-based big-data analytics and AI solutions for multinational and domestic enterprises and government agencies in China. In September 2016, the company sold 6.7 million shares at $13, raising $87 million in its initial public offering. Since then, GSUM stock has mainly followed a downward trend.


(Source: Yahoo! Finance)