Neusoft Group Ltd will acquire its parent through a share swap, which will double the market value of the Shanghai-listed software vendor to 520 million yuan (US$70.27 million), Neusoft said in a statement yesterday.

 

Chinese software firms, which grew most rapidly, need to boost economies of scale to compete internationally, the Ministry of Information Industry said.

 

Neusoft has received approval from regulators, including the China Securities Regulatory Commission, to buy its parent's assets via a share swap of 1 to 3.5, according to the company's statement to the Shanghai Stock Exchange.

 

After the purchase, the firm will be valued at 520 million yuan from 280 million yuan now.

 

"The deal is a milestone in the company's history and it will continue to grow through the resources acquired from the parent firm," said Neusoft's chairman Liu Jiren in a Chinese-language statement.

 

(Shanghai Daily December 27, 2007)