Schedule 13D Amendment No. 2

0001193125-13-424035.txt : 20131104 0001193125-13-424035.hdr.sgml : 20131104 20131104063433 ACCESSION NUMBER: 0001193125-13-424035 CONFORMED SUBMISSION TYPE: SC 13D/A PUBLIC DOCUMENT COUNT: 2 FILED AS OF DATE: 20131104 DATE AS OF CHANGE: 20131104 GROUP MEMBERS: ACCURATE GLOBAL LTD GROUP MEMBERS: ADVANCED ORIENT LTD GROUP MEMBERS: CHINA EVERBRIGHT GP LTD GROUP MEMBERS: CHINA EVERBRIGHT LTD GROUP MEMBERS: CHINA FOREBRIGHT INVESTMENT MANAGEMENT LTD GROUP MEMBERS: CHINA SPECIAL OPPORTUNITIES FUND III, L.P. GROUP MEMBERS: CHINA SPECIAL OPPORTUNITIES FUND, L.P. GROUP MEMBERS: CSOF III GP LTD GROUP MEMBERS: CSOF TECHNOLOGY INVESTMENTS LTD GROUP MEMBERS: FOREBRIGHT ADVISORS LTD GROUP MEMBERS: FOREBRIGHT PARTNERS LTD GROUP MEMBERS: WINDSOR VENTURE LTD SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: iSoftStone Holdings Ltd CENTRAL INDEX KEY: 0001500308 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-COMPUTER PROGRAMMING SERVICES [7371] IRS NUMBER: 000000000 FILING VALUES: FORM TYPE: SC 13D/A SEC ACT: 1934 Act SEC FILE NUMBER: 005-85929 FILM NUMBER: 131187535 BUSINESS ADDRESS: STREET 1: EAST BLDG. 16, COURTYARD #10 STREET 2: XIBEIWANG EAST ROAD, HAIDIAN DISTRICT CITY: Beijing STATE: F4 ZIP: 100193 BUSINESS PHONE: (86-10) 5874-9000 MAIL ADDRESS: STREET 1: EAST BLDG. 16, COURTYARD #10 STREET 2: XIBEIWANG EAST ROAD, HAIDIAN DISTRICT CITY: Beijing STATE: F4 ZIP: 100193 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: CHINA EVERBRIGHT INVESTMENT MANAGEMENT LTD CENTRAL INDEX KEY: 0001578762 IRS NUMBER: 000000000 STATE OF INCORPORATION: K3 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D/A BUSINESS ADDRESS: STREET 1: 40TH FLOOR FAR EAST FINANCE CENTRE STREET 2: 16 HARCOURT ROAD CITY: HONG KONG STATE: K3 ZIP: 00000 BUSINESS PHONE: 852-2530-8395 MAIL ADDRESS: STREET 1: 40TH FLOOR FAR EAST FINANCE CENTRE STREET 2: 16 HARCOURT ROAD CITY: HONG KONG STATE: K3 ZIP: 00000 SC 13D/A 1 d622640dsc13da.htm SCHEDULE 13D AMENDMENT NO. 2 Schedule 13D Amendment No. 2

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 13D

(Rule 13d-1)

Under the Securities Exchange Act of 1934

(Amendment No. 2)*

ISOFTSTONE HOLDINGS LIMITED

(Name of Issuer)

Ordinary Shares, par value $0.0001

(Title of Class of Securities)

46489B108**

(CUSIP Number)

Ip Kun Wan, Kiril

Managing Director

Direct Investment Department

China Everbright Investment Management Limited

40/F, Far East Finance Centre

16 Harcourt Road, Hong Kong

Tel: +852 2528 9882

(Name, Address and Telephone Number of Person Authorized to Receive Notices and Communications)

November 2, 2013

(Date of Event Which Requires Filing of This Statement)

If the filing person has previously filed a statement on Schedule 13G to report the acquisition which is the subject of this Schedule 13D, and is filing this schedule because of Rule 13d-1(e), 13d-1(f) or 13d-1(g), check the following box ¨.

Note: Schedules filed in paper format shall include a signed original and five copies of the Schedule, including all exhibits. See Section 240.13d-7 for other parties to whom copies are to be sent.

*	The remainder of this cover page shall be filled out for a reporting person’s initial filing on this form with respect to the subject class of securities, and for any subsequent amendment containing information which would alter disclosures provided in a prior cover page.

**	This CUSIP number applies to the American Depositary Shares, evidenced by American Depositary Receipts, each representing ten ordinary shares, par value $0.0001 per share. No CUSIP has been assigned to the ordinary shares.

The information required on the remainder of this cover page shall not be deemed to be “filed” for the purpose of Section 18 of the Securities Exchange Act of 1934 (“Act”) or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see the Notes).

SCHEDULE 13D


CUSIP No 46489B108		Page 2 of 21 Pages


1	Name of reporting persons CHINA EVERBRIGHT LIMITED
2	Check the appropriate box if a member of a group (see instructions) (a) ¨ (b) x
3	SEC use only
4	Source of funds (see instructions) WC, OO
5	Check box if disclosure of legal proceedings is required pursuant to Items 2(d) or 2(e) ¨
6	Citizenship or place of organization HONG KONG
Number of shares beneficially owned by each reporting person with		7	Sole voting power 0
		8	Shared voting power 36,731,389 ⁽¹⁾
		9	Sole dispositive power 0
		10	Shared dispositive power 36,731,389 ⁽¹⁾
11	Aggregate amount beneficially owned by each reporting person 36,731,389 ⁽¹⁾
12	Check box if the aggregate amount in Row (11) excludes certain shares (see instructions) x
13	Percent of class represented by amount in Row (11) 6.38% ⁽¹⁾
14	Type of reporting person (see instructions) OO – See Item 3

⁽¹⁾	Excludes 70,545,117 Ordinary Shares of the Issuer beneficially owned by Mr. Tianwen Liu (the “Founder”), which Ordinary Shares may be deemed beneficially owned by the Reporting Person. See items 4 and 5.

SCHEDULE 13D


CUSIP No 46489B108		Page 3 of 21 Pages


1	Name of reporting persons CHINA EVERBRIGHT INVESTMENT MANAGEMENT LIMITED
2	Check the appropriate box if a member of a group (see instructions) (a) ¨ (b) x
3	SEC use only
4	Source of funds (see instructions) OO
5	Check box if disclosure of legal proceedings is required pursuant to Items 2(d) or 2(e) ¨
6	Citizenship or place of organization HONG KONG
Number of shares beneficially owned by each reporting person with		7	Sole voting power 0
		8	Shared voting power 7,842,499 ⁽²⁾
		9	Sole dispositive power 0
		10	Shared dispositive power 7,842,499 ⁽²⁾
11	Aggregate amount beneficially owned by each reporting person 7,842,499 ⁽²⁾
12	Check box if the aggregate amount in Row (11) excludes certain shares (see instructions) x
13	Percent of class represented by amount in Row (11) 1.36% ⁽²⁾
14	Type of reporting person (see instructions) OO, IA – See Item 3

⁽²⁾	Excludes (i) 70,545,117 Ordinary Shares of the Issuer beneficially owned by the Founder and (ii) 28,888,890 Ordinary Shares held by certain other Reporting Persons, in each case such Ordinary Shares may be deemed beneficially owned by the Reporting Person. See items 4 and 5.

SCHEDULE 13D


CUSIP No 46489B108		Page 4 of 21 Pages


1	Name of reporting persons WINDSOR VENTURE LIMITED
2	Check the appropriate box if a member of a group (see instructions) (a) ¨ (b) x
3	SEC use only
4	Source of funds (see instructions) OO
5	Check box if disclosure of legal proceedings is required pursuant to Items 2(d) or 2(e) ¨
6	Citizenship or place of organization BRITISH VIRGIN ISLANDS
Number of shares beneficially owned by each reporting person with		7	Sole voting power 0
		8	Shared voting power 9,412,421 ⁽³⁾
		9	Sole dispositive power 0
		10	Shared dispositive power 9,412,421 ⁽³⁾
11	Aggregate amount beneficially owned by each reporting person 9,412,421 ⁽³⁾
12	Check box if the aggregate amount in Row (11) excludes certain shares (see instructions) x
13	Percent of class represented by amount in Row (11) 1.63% ⁽³⁾
14	Type of reporting person (see instructions) OO – See Item 3

⁽³⁾	Excludes (i) 70,545,117 Ordinary Shares of the Issuer beneficially owned by the Founder and (ii) 27,318,968 Ordinary Shares held by certain other Reporting Persons, in each case such Ordinary Shares may be deemed beneficially owned by the Reporting Person. See items 4 and 5.

SCHEDULE 13D


CUSIP No 46489B108		Page 5 of 21 Pages


1	Name of reporting persons FOREBRIGHT PARTNERS LIMITED
2	Check the appropriate box if a member of a group (see instructions) (a) ¨ (b) x
3	SEC use only
4	Source of funds (see instructions) OO
5	Check box if disclosure of legal proceedings is required pursuant to Items 2(d) or 2(e) ¨
6	Citizenship or place of organization BRITISH VIRGIN ISLANDS
Number of shares beneficially owned by each reporting person with		7	Sole voting power 0
		8	Shared voting power 28,888,890 ⁽⁴⁾
		9	Sole dispositive power 0
		10	Shared dispositive power 28,888,890 ⁽⁴⁾
11	Aggregate amount beneficially owned by each reporting person 28,888,890 ⁽⁴⁾
12	Check box if the aggregate amount in Row (11) excludes certain shares (see instructions) x
13	Percent of class represented by amount in Row (11) 5.02% ⁽⁴⁾
14	Type of reporting person (see instructions) OO – See Item 3

(4)	Excludes (i) 70,545,117 Ordinary Shares of the Issuer beneficially owned by the Founder and (ii) 7,842,499 Ordinary Shares held by certain other Reporting Persons, in each case such Ordinary Shares may be deemed beneficially owned by the Reporting Person. See items 4 and 5.

SCHEDULE 13D


CUSIP No 46489B108		Page 6 of 21 Pages


1	Name of reporting persons CSOF III GP LIMITED
2	Check the appropriate box if a member of a group (see instructions) (a) ¨ (b) x
3	SEC use only
4	Source of funds (see instructions) OO
5	Check box if disclosure of legal proceedings is required pursuant to Items 2(d) or 2(e) ¨
6	Citizenship or place of organization CAYMAN ISLANDS
Number of shares beneficially owned by each reporting person with		7	Sole voting power 0
		8	Shared voting power 28,888,890 ⁽⁵⁾
		9	Sole dispositive power 0
		10	Shared dispositive power 28,888,890 ⁽⁵⁾
11	Aggregate amount beneficially owned by each reporting person 28,888,890 ⁽⁵⁾
12	Check box if the aggregate amount in Row (11) excludes certain shares (see instructions) x
13	Percent of class represented by amount in Row (11) 5.02% ⁽⁵⁾
14	Type of reporting person (see instructions) OO – See Item 3

⁽⁵⁾	Excludes (i) 70,545,117 Ordinary Shares of the Issuer beneficially owned by the Founder and (ii) 7,842,499 Ordinary Shares held by certain other Reporting Persons, in each case such Ordinary Shares may be deemed beneficially owned by the Reporting Person. See items 4 and 5.

SCHEDULE 13D


CUSIP No 46489B108		Page 7 of 21 Pages


1	Name of reporting persons FOREBRIGHT ADVISORS LIMITED
2	Check the appropriate box if a member of a group (see instructions) (a) ¨ (b) x
3	SEC use only
4	Source of funds (see instructions) OO
5	Check box if disclosure of legal proceedings is required pursuant to Items 2(d) or 2(e) ¨
6	Citizenship or place of organization BRITISH VIRGIN ISLANDS
Number of shares beneficially owned by each reporting person with		7	Sole voting power 0
		8	Shared voting power 28,888,890 ⁽⁶⁾
		9	Sole dispositive power 0
		10	Shared dispositive power 28,888,890 ⁽⁶⁾
11	Aggregate amount beneficially owned by each reporting person 28,888,890 ⁽⁶⁾
12	Check box if the aggregate amount in Row (11) excludes certain shares (see instructions) x
13	Percent of class represented by amount in Row (11) 5.02% ⁽⁶⁾
14	Type of reporting person (see instructions) OO, IA – See Item 3

⁽⁶⁾	Excludes (i) 70,545,117 Ordinary Shares of the Issuer beneficially owned by the Founder and (ii) 7,842,499 Ordinary Shares held by certain other Reporting Persons, in each case such Ordinary Shares may be deemed beneficially owned by the Reporting Person. See items 4 and 5.

SCHEDULE 13D


CUSIP No 46489B108		Page 8 of 21 Pages


1	Name of reporting persons CHINA SPECIAL OPPORTUNITIES FUND III, L.P.
2	Check the appropriate box if a member of a group (see instructions) (a) ¨ (b) x
3	SEC use only
4	Source of funds (see instructions) OO
5	Check box if disclosure of legal proceedings is required pursuant to Items 2(d) or 2(e) ¨
6	Citizenship or place of organization CAYMAN ISLANDS
Number of shares beneficially owned by each reporting person with		7	Sole voting power 0
		8	Shared voting power 19,476,469 ⁽⁷⁾
		9	Sole dispositive power 0
		10	Shared dispositive power 19,476,469 ⁽⁷⁾
11	Aggregate amount beneficially owned by each reporting person 19,476,469 ⁽⁷⁾
12	Check box if the aggregate amount in Row (11) excludes certain shares (see instructions) x
13	Percent of class represented by amount in Row (11) 3.38% ⁽⁷⁾
14	Type of reporting person (see instructions) PN – See Item 3

(7)	Excludes (i) 70,545,117 Ordinary Shares of the Issuer beneficially owned by the Founder and (ii) 17,254,920 Ordinary Shares held by certain other Reporting Persons, in each case such Ordinary Shares may be deemed beneficially owned by the Reporting Person. See items 4 and 5.

SCHEDULE 13D


CUSIP No 46489B108		Page 9 of 21 Pages


1	Name of reporting persons ACCURATE GLOBAL LIMITED
2	Check the appropriate box if a member of a group (see instructions) (a) ¨ (b) x
3	SEC use only
4	Source of funds (see instructions) AF
5	Check box if disclosure of legal proceedings is required pursuant to Items 2(d) or 2(e) ¨
6	Citizenship or place of organization BRITISH VIRGIN ISLANDS
Number of shares beneficially owned by each reporting person with		7	Sole voting power 0
		8	Shared voting power 19,476,469 ⁽⁸⁾
		9	Sole dispositive power 0
		10	Shared dispositive power 19,476,469 ⁽⁸⁾
11	Aggregate amount beneficially owned by each reporting person 19,476,469 ⁽⁸⁾
12	Check box if the aggregate amount in Row (11) excludes certain shares (see instructions) x
13	Percent of class represented by amount in Row (11) 3.38% ⁽⁸⁾
14	Type of reporting person (see instructions) OO – See Item 3

(8)	Excludes (i) 70,545,117 Ordinary Shares of the Issuer beneficially owned by the Founder and (ii) 17,254,920 Ordinary Shares held by certain other Reporting Persons, in each case such Ordinary Shares may be deemed beneficially owned by the Reporting Person. See items 4 and 5.

SCHEDULE 13D


CUSIP No 46489B108		Page 10 of 21 Pages


1	Name of reporting persons ADVANCED ORIENT LIMITED
2	Check the appropriate box if a member of a group (see instructions) (a) ¨ (b) x
3	SEC use only
4	Source of funds (see instructions) AF
5	Check box if disclosure of legal proceedings is required pursuant to Items 2(d) or 2(e) ¨
6	Citizenship or place of organization BRITISH VIRGIN ISLANDS
Number of shares beneficially owned by each reporting person with		7	Sole voting power 0
		8	Shared voting power 9,412,421 ⁽⁹⁾
		9	Sole dispositive power 0
		10	Shared dispositive power 9,412,421 ⁽⁹⁾
11	Aggregate amount beneficially owned by each reporting person 9,412,421 ⁽⁹⁾
12	Check box if the aggregate amount in Row (11) excludes certain shares (see instructions) x
13	Percent of class represented by amount in Row (11) 1.63% ⁽⁹⁾
14	Type of reporting person (see instructions) OO – See Item 3

(9)	Excludes (i) 70,545,117 Ordinary Shares of the Issuer beneficially owned by the Founder and (ii) 27,318,968 Ordinary Shares held by certain other Reporting Persons, in each case such Ordinary Shares may be deemed beneficially owned by the Reporting Person. See items 4 and 5.

SCHEDULE 13D


CUSIP No 46489B108		Page 11 of 21 Pages


1	Name of reporting persons CHINA EVERBRIGHT GP LIMITED
2	Check the appropriate box if a member of a group (see instructions) (a) ¨ (b) x
3	SEC use only
4	Source of funds (see instructions) OO
5	Check box if disclosure of legal proceedings is required pursuant to Items 2(d) or 2(e) ¨
6	Citizenship or place of organization CAYMAN ISLANDS
Number of shares beneficially owned by each reporting person with		7	Sole voting power 0
		8	Shared voting power 7,842,499 ⁽¹⁰⁾
		9	Sole dispositive power 0
		10	Shared dispositive power 7,842,499 ⁽¹⁰⁾
11	Aggregate amount beneficially owned by each reporting person 7,842,499 ⁽¹⁰⁾
12	Check box if the aggregate amount in Row (11) excludes certain shares (see instructions) x
13	Percent of class represented by amount in Row (11) 1.36% ⁽¹⁰⁾
14	Type of reporting person (see instructions) OO – See Item 3

(10)	Excludes (i) 70,545,117 Ordinary Shares of the Issuer beneficially owned by the Founder and (ii) 28,888,890 Ordinary Shares held by certain other Reporting Persons, in each case such Ordinary Shares may be deemed beneficially owned by the Reporting Person. See items 4 and 5.

SCHEDULE 13D


CUSIP No 46489B108		Page 12 of 21 Pages


1	Name of reporting persons CHINA FOREBRIGHT INVESTMENT MANAGEMENT LIMITED
2	Check the appropriate box if a member of a group (see instructions) (a) ¨ (b) x
3	SEC use only
4	Source of funds (see instructions) OO
5	Check box if disclosure of legal proceedings is required pursuant to Items 2(d) or 2(e) ¨
6	Citizenship or place of organization HONG KONG
Number of shares beneficially owned by each reporting person with		7	Sole voting power 0
		8	Shared voting power 7,842,499 ⁽¹¹⁾
		9	Sole dispositive power 0
		10	Shared dispositive power 7,842,499 ⁽¹¹⁾
11	Aggregate amount beneficially owned by each reporting person 7,842,499 ⁽¹¹⁾
12	Check box if the aggregate amount in Row (11) excludes certain shares (see instructions) x
13	Percent of class represented by amount in Row (11) 1.36% ⁽¹¹⁾
14	Type of reporting person (see instructions) OO, IA – See Item 3

(11)	Excludes (i) 70,545,117 Ordinary Shares of the Issuer beneficially owned by the Founder and (ii) 28,888,890 Ordinary Shares held by certain other Reporting Persons, in each case such Ordinary Shares may be deemed beneficially owned by the Reporting Person. See items 4 and 5.

SCHEDULE 13D


CUSIP No 46489B108		Page 13 of 21 Pages


1	Name of reporting persons CHINA SPECIAL OPPORTUNITIES FUND, L.P.
2	Check the appropriate box if a member of a group (see instructions) (a) ¨ (b) x
3	SEC use only
4	Source of funds (see instructions) OO
5	Check box if disclosure of legal proceedings is required pursuant to Items 2(d) or 2(e) ¨
6	Citizenship or place of organization CAYMAN ISLANDS
Number of shares beneficially owned by each reporting person with		7	Sole voting power
		8	Shared voting power 7,842,499 ⁽¹²⁾
		9	Sole dispositive power 0
		10	Shared dispositive power 7,842,499 ⁽¹²⁾
11	Aggregate amount beneficially owned by each reporting person 7,842,499 ⁽¹²⁾
12	Check box if the aggregate amount in Row (11) excludes certain shares (see instructions) x
13	Percent of class represented by amount in Row (11) 1.36% ⁽¹²⁾
14	Type of reporting person (see instructions) PN – See Item 3

(12)	Excludes (i) 70,545,117 Ordinary Shares of the Issuer beneficially owned by the Founder and (ii) 28,888,890 Ordinary Shares held by certain other Reporting Persons, in each case such Ordinary Shares may be deemed beneficially owned by the Reporting Person. See items 4 and 5.

SCHEDULE 13D


CUSIP No 46489B108		Page 14 of 21 Pages


1	Name of reporting persons CSOF TECHNOLOGY INVESTMENTS LIMITED
2	Check the appropriate box if a member of a group (see instructions) (a) ¨ (b) x
3	SEC use only
4	Source of funds (see instructions) AF
5	Check box if disclosure of legal proceedings is required pursuant to Items 2(d) or 2(e) ¨
6	Citizenship or place of organization BRITISH VIRGIN ISLANDS
Number of shares beneficially owned by each reporting person with		7	Sole voting power 0
		8	Shared voting power 7,842,499 ⁽¹³⁾
		9	Sole dispositive power 0
		10	Shared dispositive power 7,842,499 ⁽¹³⁾
11	Aggregate amount beneficially owned by each reporting person 7,842,499 ⁽¹³⁾
12	Check box if the aggregate amount in Row (11) excludes certain shares (see instructions) x
13	Percent of class represented by amount in Row (11) 1.36% ⁽¹³⁾
14	Type of reporting person (see instructions) OO – See Item 3

(13)	Excludes (i) 70,545,117 Ordinary Shares of the Issuer beneficially owned by the Founder and (ii) 28,888,890 Ordinary Shares held by certain other Reporting Persons, in each case such Ordinary Shares may be deemed beneficially owned by the Reporting Person. See items 4 and 5.


				Page 15 of 21 Pages

This Amendment No. 2 (this “Amendment”) amends and supplements the Schedule 13D (the “Original Schedule 13D”) filed by the Reporting Persons with the Securities and Exchange Commission (the “SEC”) on June 17, 2013 with respect to iSoftStone Holdings Limited, as previously amended by Amendment No. 1 (the “Amendment No. 1”) to the Original Schedule 13D filed on July 26, 2013.

Item 1.

Security and Issuer

Item 1 is hereby amended and restated in its entirety as follows:

This statement on Schedule 13D, as amended and supplemented (this “Statement”), relates to the ordinary shares, par value $0.0001 per share (the “Ordinary Shares”), of iSoftStone Holdings Limited (the “Issuer” or the “Company”), an exempted company with limited liability incorporated under the laws of the Cayman Islands. The address of the principal executive offices of the Issuer is Building 16, Dong Qu, 10 Xibeiwang Dong Lu, Haidian District, Beijing 100193, The People’s Republic of China.

Item 4.

Purpose of Transaction.

Item 4 is hereby amended and supplemented as follows:

On November 2, 2013, the Founder, the Sponsor, and Accurate Global Limited, Advanced Orient Limited and CSOF Technology Investments Limited (the “Everbright Entities”) submitted a binding offer for the Company (the “New Proposal Letter”) to Goldman Sachs (Asia) L.L.C., the financial advisor to the independent committee of the board of directors of the Company (the “Independent Committee”), to acquire all the outstanding Ordinary Shares, including the Ordinary Shares represented by American Depositary Shares (the “ADSs”), of the Company that are not already owned by the Consortium (the “Transaction”), on the following terms and conditions:

•

The Consortium consists of the Founder, the Sponsor and the Everbright Entities.

•

The New Proposal Letter stated that the offer price for the Transaction is US$0.545 in cash per Ordinary Share or US$5.45 in cash per ADS. It has been adjusted down from the initial non-binding offer price of US$0.585 per Ordinary Share or US$5.85 in cash per ADS contained in the non-binding proposal letter (the “Proposal Letter”) submitted by the Sponsor and the Founder to the board of directors of the Company on June 6, 2013, which was based on publicly available information at that time, due to several factors, including that, subsequent to the Proposal Letter, the Company has experienced and disclosed weaker than expected financial performance; the Company has suffered worse than expected operating cash flow; and the Company’s total debt level has significantly increased.

•

The New Proposal Letter stated that the Consortium intends to finance the Transaction with a combination of equity provided by the Sponsor, rollover equity from the Founder, the Everbright Entities and possibly other rollover shareholders, a certain amount of cash of the Company, and debt (the “Debt Financing”) to be arranged by a reputable bank, and that the New Proposal Letter is not subject to any financing conditions.


				Page 16 of 21 Pages

•

The New Proposal Letter stated that the Consortium plans to structure the Transaction as a merger, by which a wholly-owned subsidiary of the holding company that is 100% owned by the Consortium (“Parent”), will merge with and into the Company, making the Company privately held and wholly-owned by Parent.

•

The New Proposal Letter stated that, based on the data access the Consortium has received, the Consortium has substantially completed its due diligence, subject to certain confirmatory items (including tax due diligence) to be made available by the Independent Committee at a later stage of the process. The Consortium expects that the regulatory approvals required for the Transaction will include customary SEC filings and antitrust approvals (if any).

•

The New Proposal Letter also stated that it would be effective until 5:00 p.m. Hong Kong time on November 30, 2013, after which the Consortium reserve the right to withdraw the New Proposal Letter. In addition, the New Proposal Letter stated that it did not constitute a binding obligation to effect the proposed Transaction, and any such binding obligation would be set forth only in the definitive agreements with respect to the proposed Transaction.

In addition, the Consortium has obtained a highly confident letter (the “Highly Confident Letter”) issued by a reputable bank on October 25, 2013, pursuant to which such bank is highly confident to be able to arrange the Debt Financing, has obtained initial approvals from its credit committees for the Debt Financing and would be able to complete the Debt Financing in a timely and efficient manner.

The description of the New Proposal Letter set forth above in this Item 4 does not purport to be complete and is qualified in its entirety by reference to the full text of the New Proposal Letter, which has been filed as Exhibit 5, and is incorporated herein by this reference.

Item 5.

Interest in Securities of the Issuer.

Item 5 is hereby amended and restated in its entirety as set forth below:

The information contained on each of the cover pages of this Amendment and the information set forth or incorporated in Items 3, 4, and 6 of the Original Schedule 13D, as amended by the Amendment No. 1 and this Amendment, are hereby incorporated herein by reference.


(a) – (b)		By virtue of their relationships described in Item 2 of the Original Schedule 13D, each Reporting Person may be deemed to (i) constitute a “group” (within the meaning of Rule 13d-5(b) of the Exchange Act) with the other Reporting Persons and (ii) beneficially own the 36,731,389 Ordinary Shares collectively, directly held by CSOF Technology Investments, Accurate Global and Advanced Orient, which represents approximately 6.38% of the outstanding Ordinary Shares. Neither the filing of this Statement nor any of its contents shall be deemed to constitute an admission by any Reporting Person that it is the beneficial owner of any Ordinary Shares (other than the Ordinary Shares shown on its cover page) for purposes of Section 13(d) of the Exchange Act, or for any other purpose, and such beneficial ownership is expressly disclaimed. Each Reporting Person hereby disclaims membership of a “group” (within the meaning of Rule 13d-5(b) of the Exchange Act) with any other Reporting Person or any other person.


				Page 17 of 21 Pages


		The Reporting Persons are filing this Statement jointly pursuant to Rule 13d-1(k)(i) promulgated under the Exchange Act, provided that, as contemplated by Rule 13d-1(k)(ii), no Reporting Person shall be responsible for the completeness or accuracy of the information concerning the other Reporting Persons making the filing of this Statement, unless such Reporting Person knows or has reason to believe that such information is inaccurate. To the knowledge of the Reporting Persons, none of the persons listed on Schedule A of the Original Schedule 13D beneficially owns any Ordinary Shares. Except as set forth in this Item 5, no person other than the Reporting Persons and their shareholders or partners, as the case may be, is known to have the right to receive or the power to direct the receipt of dividends from, or the proceeds from the sale of, the Ordinary Shares held by the Everbright Entities. As further described in Item 4 above, the Reporting Persons may be deemed to (i) be a “group”, within the meaning of Rule 13d-5(b) promulgated under the Exchange Act, with the Founder, which beneficially owns 70,545,117 Ordinary Shares of the Issuer, as a result of the Consortium Agreement, the Framework Agreement and the New Proposal Letter; and (ii) beneficially own the 70,545,117 Ordinary Shares held by the Founder, which represents approximately 11.90% of the outstanding Ordinary Shares. However, the Reporting Persons expressly disclaim beneficial ownership of any Ordinary Shares held by the Founder, and do not affirm membership in a “group” (within the meaning of Rule 13d-5(b) of the Exchange Act) with the Founder, and this Statement shall not be construed as acknowledging that the Reporting Persons beneficially own any Ordinary Shares held by the Founder or any other person or is a member of a group with the Founder. The Reporting Persons are only responsible for the information contained in this Statement and assume no responsibility for information contained in any other Schedules 13D filed by the Founder. The above calculation of percentages was based on a total of 576,017,931 Ordinary Shares outstanding as of June 30, 2013 according to the Issuer’s Form 6-K filed with the SEC on August 28, 2013.

(c)		The Reporting Persons have not effected any transactions in the Ordinary Shares of the Issuer during the 60 days preceding the filing of this Amendment.

(d) – (e)		Not applicable.


				Page 18 of 21 Pages

Item 6.

Contracts, Arrangements, Understandings or Relationships with Respect to Securities of the Issuer

Item 6 is hereby amended and supplemented as follows:

The information regarding the New Proposal Letter and the Highly Confident Letter under Item 4 is incorporated herein by reference in its entirety.

Item 7.

Material to be Filed as Exhibits.

Item 7 is hereby supplemented by adding the following exhibits.


Exhibit 5		Binding Proposal Letter from Mr. Tianwen Liu, ChinaAMC Capital Management Limited, Accurate Global Limited, Advance Orient Limited and CSOF Technology Investments Limited, dated as of November 2, 2013.

Page 19 of 21 Pages

SIGNATURES

After reasonable inquiry and to the best of my knowledge and belief, I certify that the information set forth in this Statement is true, complete and correct.

Dated: November 4, 2013


China Everbright Limited

By:	/s/ Tang Chi Chun, Richard
	Name:	Tang Chi Chun, Richard
	Title:	Authorized Signatory

China Everbright Investment Management Limited

By:	/s/ Ip Kun Wan
	Name:	Ip Kun Wan
	Title:	Authorized Signatory

Windsor Venture Limited

By:	/s/ Tang Chi Chun, Richard
	Name:	Tang Chi Chun, Richard
	Title:	Authorized Signatory

Forebright Partners Limited

By:	/s/ Ip Kun Wan
	Name:	Ip Kun Wan
	Title:	Authorized Signatory

Signature page


				Page 20 of 21 Pages


CSOF III GP Limited

By:	/s/ Ip Kun Wan
	Name:	Ip Kun Wan
	Title:	Authorized Signatory

Forebright Advisors Limited

By:	/s/ Ip Kun Wan
	Name:	Ip Kun Wan
	Title:	Authorized Signatory

China Special Opportunities Fund III, L.P.

By CSOF III GP Limited, its general partner

By:	/s/ Ip Kun Wan
	Name:	Ip Kun Wan
	Title:	Authorized Signatory

Accurate Global Limited

By:	/s/ Ip Kun Wan
	Name:	Ip Kun Wan
	Title:	Authorized Signatory

Advanced Orient Limited

By:	/s/ Tang Chi Chun, Richard
	Name:	Tang Chi Chun, Richard
	Title:	Authorized Signatory


				Page 21 of 21 Pages


China Everbright GP Limited

By:	/s/ Ip Kun Wan
	Name:	Ip Kun Wan
	Title:	Authorized Signatory

China Forebright Investment Management Limited

By:	/s/ Ip Kun Wan
	Name:	Ip Kun Wan
	Title:	Authorized Signatory

China Special Opportunities Fund, L.P.

By China Everbright GP Limited, its general partner

By:	/s/ Ip Kun Wan
	Name:	Ip Kun Wan
	Title:	Authorized Signatory

CSOF Technology Investments Limited

By:	/s/ Ip Kun Wan
	Name:	Ip Kun Wan
	Title:	Authorized Signatory

EX-5 2 d622640dex5.htm EX-5 EX-5

Exhibit 5

November 2, 2013

STRICTLY PRIVATE AND CONFIDENTIAL

Goldman Sachs (Asia) L.L.C.

Attention: Dan Swift and Andrew Huang

68/F Cheung Kong Center

2 Queen’s Road Central

Hong Kong, Hong Kong SAR

Dear Messrs. Swift and Huang:

Reference is made to your process letter, dated October 30, 2013, soliciting a non-binding proposal regarding the acquisition by the Consortium (as defined below) of all of the outstanding shares of iSoftStone Holdings Limited (the “Company”) that are not already owned by the Consortium (the “Transaction”).

We began legal and accounting due diligence on the Company on August 20, 2013 and have conducted business due diligence with the management for the past three weeks. During the course of such periods, we have substantially completed our due diligence based on the materials provided by the Company and we would like to express our sincere appreciation to the management, the Independent Committee of the Board of Directors of the Company and its advisors for the time and access with which we have been provided throughout the course of the process. As you are aware, we have committed significant time and resources to the evaluation of the Company, and we believe that we can complete due diligence and execute definitive documentation with respect to the Transaction promptly with the active engagement of the Independent Committee and its advisors. In addition, we would expect to be able to close the Transaction promptly after we complete our due diligence as the only substantive closing conditions would be required regulatory and shareholder approvals.

We are highly committed to complete the Transaction in an expeditious manner and are pleased to submit a binding offer (the “Proposal”) for the Company. This Proposal underscores our continued strong interest in the Company and we look forward to the opportunity to successfully consummate this transaction with the Company.

Set forth below are the key terms of our Proposal.

1. Consortium. The consortium (the “Consortium”) currently consists of the following members (collectively, the “Consortium Members”):

•

Mr. Tianwen Liu, the Chief Executive Officer and the Chairman of the Board of Directors of the Company;

•

ChinaAMC Capital Management Limited (the “Sponsor”), an alternative investment platform and an affiliate of China Asset Management (Hong Kong) Limited; and

•

Accurate Global Limited, Advance Orient Limited and CSOF Technology Investments Limited, existing shareholders of the Company (the “Everbright Entities”), who agreed to participate in the Transaction with the Sponsor pursuant to a Framework Agreement dated July 24, 2013, as disclosed in the Schedule 13D filed on July 26, 2013.

As you know, Mr. Tianwen Liu and the Everbright Entities have each agreed to work exclusively with the Sponsor and are interested only in pursuing this Transaction and are not interested in selling their ordinary shares or the American Depositary Shares (“ADSs,” each representing 10 ordinary shares of the Company) in any other transaction involving the Company.

2. Binding Offer Price. Our binding offer price for the Company is US$0.545 in cash per ordinary share or US$5.45 in cash per ADS, in each case other than for the ordinary shares and ADSs beneficially owned by Mr. Tianwen Liu and the Everbright Entities that may be rolled over in connection with the Transaction.

Our binding offer price has been adjusted down from the initial non-binding offer price stated in the preliminary proposal submitted by Mr. Tianwen Liu and the Sponsor to the Board of Directors on June 6, 2013 (the “Announcement”), which was based on publicly available information at that time, due to several factors, including the following:

Since the Announcement, the Company has experienced and disclosed weaker than expected financial performance. The Company’s reported income from operations declined by 115.2% year-on-year for the second quarter of 2013, and the Company recorded a net loss of US$1.9 million for the second quarter of 2013 compared with a net income of US$3.6 million for the same period of 2012. In addition, the Company is expected to record a net loss for the third quarter of 2013, according to the Company’s earnings release for the second quarter of 2013.

Since the Announcement, the Company has suffered worse than expected operating cash flow. The Company’s net cash used in operating activities increased from US$29.0 million for the first six months of 2012 to US$40.3 million for the first six months of 2013 and days sales outstanding was extended from 167 days for the first six months of 2012 to 194 days for the first six months of 2013. We believe that such deterioration in the cash flow has had a negative impact on the value of the Company.

The Company’s total debt level has significantly increased from US$59.0 million as of March 31, 2013 to US$155.5 million as of June 30, 2013, 72.8% of which is short-term borrowings. Such total amount of the Company’s debt represents 4.1 times of the Company’s EBITDA of US$37.8 million for the twelve months ended June 30, 2013. The increased leverage ratio would significantly limit the Company’s options and would increase the Company’s costs for future financings.

Under our binding offer price, (i) the implied equity value of the Company is US$332.4 million based on a total outstanding number of ordinary shares of 609.9 million, assuming the exercise of all in-the-money options and restricted shares units, excluding any proceeds from such exercise, and (ii) the implied enterprise value of the Company is US$411.9 million, based on the implied equity value plus (1) total debt of US$155.5 million, plus (2) minority interest of US$6.8 million, and minus (3) cash of US$82.8 million, as of June 30, 2013. The implied enterprise value of the Company represents a multiple of 10.1 times the Non-GAAP income from operations of US$40.9 million and the equity value of the Company represents a multiple of 9.9 times the Non-GAAP net income of US$33.5 million, as reported by the Company for the twelve months ended June 30, 2013.

We believe our Proposal, which represents a premium of 23.6% to the Company’s average closing price for the last 30-trading days prior to the Announcement, provides a very attractive opportunity to the Company’s shareholders to realize superior value and our commitment provides a high degree of comfort regarding the certainty of closing.

3. Transaction Structure. We plan to structure the Transaction as a merger, by which a wholly-owned subsidiary of the holding company that is 100% owned by the Consortium (“Parent”), will merge with and into the Company, making the Company privately held and wholly-owned by Parent. We hereby confirm that we are acting as principal and not as agent in relation to the proposed Transaction.

4. Financing Sources. We intend to finance the Transaction with a combination of equity provided by the Sponsor, rollover equity from Mr. Tianwen Liu, the Everbright Entities and possibly other rollover shareholders, a certain amount of cash of the Company, and debt (the “Debt Financing”) to be arranged by a reputable bank. Pursuant to a highly confident letter issued by such bank on October 25, 2013, such bank is highly confident to be able to arrange the Debt Financing, has obtained initial approvals from its credit committees for the Debt Financing and would be able to complete the Debt Financing in a timely and efficient manner. Please note that our Proposal is not subject to any financing conditions.

5. Management Retention. We plan to retain all senior management members of the Company after closing of the Transaction.

6. Internal Approvals. The signatories of the Proposal are duly authorized representatives of the Consortium. The Consortium has received all internal approvals necessary to submit this Proposal.

7. External Approvals. Other than customary SEC filings and antitrust approvals (if any), we do not expect that the Transaction will be subject to any governmental or regulatory approvals.

8. Due Diligence. Based upon the data access that we have received, we have substantially completed our due diligence. We have requested, and you have agreed to provide, access to certain confirmatory items (including tax due diligence) to be available at the final stage of the process. Our Proposal is subject to the completion of due diligence on such confirmatory items. We are highly confident that we will be able to complete our due diligence on these items expeditiously with your cooperation.

9. Merger Agreement. We have enclosed our proposed merger agreement as attachment 1. This agreement represents the form of merger agreement we would be prepared to execute.

10. Binding Offer Expiry Date. The Proposal will be effective until 5:00 p.m. Hong Kong time on November 30, 2013, after which we reserve the right to withdraw the Proposal, of which we would notify you in writing, unless the terms outlined in the Proposal are previously accepted or otherwise agreed. We are highly committed and are confident that the Transaction can be closed on a highly expedited basis as outlined in this letter, and we remain eager to engage with the Independent Committee or its advisors as soon as practicable. This Proposal does not constitute a binding obligation to effect the proposed Transaction, and any such binding obligation will be set forth only in the definitive agreements with respect to the proposed Transaction.

11. Public Disclosure. Mr. Tianwen Liu and Everbright Entities will, as required by law, promptly file an amendment to their respective existing Schedules 13D to disclose this Proposal. We are sure you will agree with us that it is otherwise in all of our interests to ensure that we proceed in a confidential manner, unless otherwise required by law, until we have executed the definitive agreements or terminated our discussions in connection with the proposed Transaction.

Our Proposal is highly attractive and provides full value for the shareholders of the Company. Moreover, our Proposal would deliver this value with great certainty, as we are prepared to move quickly and able to provide a cash transaction without financing contingencies. We look forward to working together with the Independent Committee and its advisors to consummate the Transaction successfully and expeditiously.

Enclosed:

Attachment 1: Merger Agreement

Tianwen Liu

/s/ Tianwen Liu


ChinaAMC Capital Management Limited

By:		/s/ Cynthia Zhang

Name:		Cynthia Zhang

Title:		Managing Director


Accurate Global Limited

By:		/s/ Kiril Ip

Name:		Kiril Ip

Title:		Director

Advance Orient Limited

By:		/s/ Richard Tang

Name:		Richard Tang
Title:		Director

CSOF Technology Investments Limited

By:		/s/ Kiril Ip

Name:		Kiril Ip

Title:		Director