Cloopen Group Holding Limited, a Beijing company that sells cloud software for business messaging, call centers and video meetings, completed its going-private merger on October 28, paying holders of its over-the-counter American depositary shares (OTC: RAASY) $2.9641 each in cash. Founder and CEO Changxun Sun, the private equity firm Trustbridge Partners, Hong Kong-listed Dmall (HKEX: 2586) and other shareholders agreed in May to buy it at an implied equity value of about $162.89 million.
The price is about 94% below the February 2021 IPO price, counting a 2023 change in the shares behind each ADS. The buyers never raised their December 2025 offer, though Cloopen's independent directors asked for more.
How the deal came together
Cloopen's proxy statement shows the December price surviving five months of talks:
December 22, 2025: Sun and a Trustbridge fund offered $0.4940 a share. They held 20.32% of the shares but 53.98% of the votes, mostly through Sun's 10-vote Class B shares.
December 25, 2025: The board formed a special committee of three independent directors, chaired by Adam J. Zhao and advised by Kroll and Hogan Lovells.
February: The committee chose not to seek other bidders, as the buyers controlled the vote and said they would not sell. No rival offer had come by May.
March: The buyers' first draft required $130 million of available cash at closing, with no separate vote of unaffiliated holders. The committee objected to both.
April 13 to 17: The committee asked for a higher price, and the buyers refused. Dmall joined them as an equity investor.
May 12: The agreement was signed at the December price, with an $85 million cash condition and no separate vote of unaffiliated holders, which Cayman Islands law does not require. Rollover holders had about 57% of the votes.
September 24: Shareholders approved the merger with about 99.98% of the votes cast.
October 28: The merger took effect; Cloopen filed a Form 15 the next day to end its SEC reporting.
In refusing, the buyers cited “the highly speculative macroeconomic environment,” competition from traditional rivals and “emerging AI-driven communication solutions,” and the capital needed to expand Cloopen's unified communications products. Their reason for going private looks back to the listing:
The Buyer Group members believe that the operating environment has changed significantly since the Company's initial public offering…Cloopen's proxy statement, August 21, 2026
What the buyers paid for
The price was 51.23% above the ADSs' $1.96 close on December 19, 2025, the last trading day before the proposal, and 86.22% above their 30-trading-day volume-weighted average, Cloopen said.
Most of what the buyers bought was cash. Cloopen ended 2025 with RMB923.4 million (about $132.1 million) in cash, restricted cash, term deposits and short-term investments, and no bank borrowings, its annual report shows: about 81% of the equity value. Net of that cash, the deal's enterprise value is roughly $31 million, about 0.4 times 2025 revenue of RMB535.7 million ($76.6 million), which fell 6.6%. Cloopen lost RMB238.8 million ($34.1 million) in 2025.
Kroll valued the operating business at RMB8.1 million to RMB50.9 million and the ADSs at $2.69 to $2.80. Dmall, in a Hong Kong filing, applied 0.79 times sales, the low end of US-listed peers such as 8x8, discounted for the ADSs' thin trading and reached $0.4899 a share.
Against the 2021 IPO
Cloopen sold ADSs at $16.00 in its February 2021 New York IPO, when each represented two Class A shares, or $8.00 a share; since March 15, 2023, each has represented six. The buyout's $0.4940 a share is about 94% below the IPO price, which in today's ADSs equals $48.00. The IPO price valued the 325.7 million shares outstanding afterward at about $2.6 billion.
The NYSE suspended the ADSs on May 17, 2023, because Cloopen had not filed its 2021 and 2022 annual reports, and moved to delist them that October. Cloopen had disclosed in May 2022 that KPMG, auditing its 2021 accounts, had raised misconduct by several employees, including fabricated documents, and had resigned. Cloopen settled with the SEC in February 2024 without admitting or denying its findings; the SEC imposed no civil penalty “because of its self-reporting, cooperation and remediation,” the company said.
Who owns Cloopen now
Dmall, which sells software that runs retailers' operations, paid about $34.2 million for an effective 33.03% of Cloopen, it said in an October 29 filing. In May it said the deal would “deepen synergy with Cloopen” in its own AI customer service business.
The proxy projected that Trustbridge's funds would own about 46% and Sun's entities about 9%. The two largest holders in the proxy's ownership table, a Hi Sun Technology unit (17.18%) and HongShan funds (16.53%), were not among the holders rolling over.
The buyers needed about $108 million, funded with equity and a China Merchants Bank loan of up to RMB300 million; the proxy says Cloopen is expected to make distributions to its new parent to service the loan. The buyers plan to run the business as before and have discussed relisting it in mainland China, Hong Kong or elsewhere outside the US.
ADS holders receive $2.9641 less a $5.00 cancellation fee per 100 ADSs and a $0.05 servicing fee per ADS. Cloopen said FINRA is expected to remove the RAASY symbol and warned that trades after the merger may not be valid.
