Exhibit 99.1
Changyou.com Enters into a Definitive Agreement for Going-Private Transaction
BEIJING, China, January 24, 2020 — Changyou.com Limited (“Changyou” or the “Company”) (NASDAQ: CYOU), a leading online game developer and operator in China, today announced that it has entered into a definitive Agreement and Plan of Merger (the “Merger Agreement”) with Sohu.com (Game) Limited (“Sohu Game”), an indirectly wholly-owned subsidiary of Sohu.com Limited (NASDAQ: SOHU, “Sohu”), and Changyou Merger Co. Limited (“Merger Co.,” and together with Sohu and Sohu Game, the “Sohu Group”), a wholly-owned subsidiary of Sohu Game, pursuant to which the Company will be acquired by the Sohu Group in anall-cash transaction implying an equity value of the Company of approximately $579.0 million (the “Merger”).
Pursuant to the terms of the Merger Agreement, at the effective time of the Merger (the “Effective Time”) each Class A ordinary share of the Company (each, a “Class A Ordinary Share”) issued and outstanding immediately prior to the Effective Time, other than the Excluded Shares (as defined in the Merger Agreement), will be cancelled and cease to exist, in exchange for the right to receive $5.40 in cash without interest, and each outstanding American depositary share of the Company (each, an “ADS,” representing two Class A Ordinary Shares), other than the ADSs representing the Excluded Shares, will be cancelled in exchange for the right to receive $10.80 in cash without interest (the “Merger Consideration”).
At the Effective Time, each (i) outstanding and fully-vested option (each, a “Vested Option”) to purchase Class A Ordinary Shares under the Company’s share incentive plans will be cancelled, and each holder of a Vested Option will have the right to receive an amount in cash determined by multiplying (x) the excess, if any, of $5.40 over the applicable exercise price of such Vested Option by (y) the number of Class A Ordinary Shares underlying such Vested Option; and (ii) each outstanding but unvested option (each, an “Unvested Option”) to purchase Class A Ordinary Shares under the Company’s share incentive plans will remain outstanding and continue to vest following the Effective Time in accordance with the applicable Company share incentive plan and award agreement governing such Unvested Option in effect immediately prior to the Effective Time.
The Merger Consideration represents a premium of 82.4% to the closing price of the Company’s ADSs on September 6, 2019, the last trading day prior to the Company’s announcement of its receipt of the “going-private” proposal, and a premium of 70.1% to the average closing price of the Company’s ADSs during the 30 trading days prior to its receipt of the “going-private” proposal.
The Sohu Group intends to fund the Merger primarily with debt financing. The Sohu Group has delivered a copy of an executed debt commitment letter to the Company pursuant to which Industrial and Commercial Bank of China Limited, Tokyo Branch will provide, subject to the terms and conditions set forth therein, an amount sufficient to fund in full the consummation of Merger and the other transactions related thereto.
