CDH Investments quits Focus Media buyout: media
(Reuters) - Chinese private equity firm CDH Investments has dropped out of a consortium that was looking to buy display-advertising firm Focus Media Holding Ltd FMCN.O, Dow Jones Newswires reported, citing a person with knowledge of the deal.
Focus Media shares dropped 9 percent in early trade on the Nasdaq after the report, before recovering to $23.04, down 6.9 percent.
Carlyle Group (CG.O), along with Chinese PE players FountainVest Partners, CITIC Capital Partners, CDH and China Everbright, proposed a $3.5 billion buyout offer for the Chinese advertising firm in August.
CDH, which was to invest about $200 million in the deal, dropped out citing an insufficient return on its investment, Dow Jones reported.
Focus Media management formed a committee of independent directors to evaluate the proposal and said last month the committee still had not reached a decision.
CDH wasn't immediately available for a comment. A spokesperson for Carlyle declined to comment on the story.