Finally, after three years of simmering, the idea to spin off CDC Software Corp. from its parent, CDC Corp., is ready for tasting. The enterprise software company this week expects to offer 4 million shares in an initial public offering that it hopes will raise roughly $43.4 million.
“We are expecting to price this week,” a spokeswoman for the company said in an e-mail to Managing Automation today. The company plans to use the money raised for working capital, she said.
CDC Software estimates the share price to range from $11 to $13. The American depositary shares (ADSs), representing newly issued Class A ordinary shares, have been approved for listing on the NASDAQ Global Market under the symbol CDCS.
In addition to the 4 million shares from CDC Software itself, CDC Software International Corp., the direct parent of CDC Software and a subsidiary of CDC Corp., will offer 800,000 shares of CDC Software, to raise an estimated $8.7 million. Those proceeds, however, will not go to the spun-off entity, according to a company announcement. After the offering, CDC Software International will continue to hold Class B ordinary shares, which carry 10 times the voting power of the Class A shares. This arrangement would mean that CDC Corp., through CDC Software International, would wield 98.1% of the voting interests and an 83.4% equity interest in the company after the offering.