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NQ Mobile Inc (ADR)(NYSE:NQ) Reverses Pre-Market Gains

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By on Technology & Software

NQ Mobile Inc (ADR)(NYSE:NQ) shares rose in Tuesday’s pre-market session, after the provider of mobile-Internet services said it agreed to sell a 3.4% stake in its wholly owned subsidiary Beijing NationSky Network Technology for $18 million to Beijing Guorun Qilian Venture Capital Center as it prepares the unit for a possible IPO. 

The sale gives NationSky a pre-money valuation of $500 million and a post-money valuation of $530 million. 
NQ said it will sell up to another 2.3% of NationSky for $12 million to other investors over the next two months. 

NQ plans to use the proceeds for research and development, marketing, working capital and to expand NationSky’s core operations. 

The company noted investors have a right to demand redemption of their investment if NationSky doesn’t complete a qualified initial public offering, or find a third-party buyer to acquire all or part of its shares for a valuation of at least $550 million for NationSky’s business within 24 months after the investment is completed. 

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