If the filing person has previously filed a statement on Schedule
13G to report the acquisition that is the subject of this Schedule 13D, and is filing this schedule because of Rule 13d-1(e), Rule
13d-1(f) or Rule 13d-1(g), check the following box. [ ]
* 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.
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).
CUSIP No. 26853A100
|
SCHEDULE 13D
|
Page
2
of 10 Pages
|
1
|
NAME OF REPORTING PERSON
Burford Capital Investment Management LLC
|
2
|
CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
|
(a)
¨
(b)
¨
|
3
|
SEC USE ONLY
|
4
|
SOURCE OF FUNDS
AF
|
5
|
CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDING IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e)
|
¨
|
6
|
CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
|
NUMBER OF
SHARES
BENEFICIALLY
OWNED BY
EACH
REPORTING
PERSON WITH:
|
7
|
SOLE VOTING POWER
-0-
|
8
|
SHARED VOTING POWER
4,900,394 Class A Common Shares*
|
9
|
SOLE DISPOSITIVE POWER
-0-
|
10
|
SHARED DISPOSITIVE POWER
4,900,394 Class A Common Shares*
|
11
|
AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH PERSON
4,900,394 Class A Common Shares*
|
12
|
CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
|
¨
|
13
|
PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
6.6%
|
14
|
TYPE OF REPORTING PERSON
IA
|
|
|
|
|
|
* Includes 4,900,394 Class A Common Shares held in the form of 2,450,197
American Depositary Shares ("
ADSs
").
CUSIP No. 26853A100
|
SCHEDULE 13D
|
Page
3
of 10 Pages
|
1
|
NAME OF REPORTING PERSON
Burford Capital Limited
|
2
|
CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
|
(a)
¨
(b)
¨
|
3
|
SEC USE ONLY
|
4
|
SOURCE OF FUNDS
AF
|
5
|
CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDING IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e)
|
¨
|
6
|
CITIZENSHIP OR PLACE OF ORGANIZATION
Guernsey
|
NUMBER OF
SHARES
BENEFICIALLY
OWNED BY
EACH
REPORTING
PERSON WITH:
|
7
|
SOLE VOTING POWER
-0-
|
8
|
SHARED VOTING POWER
4,900,394 Class A Common Shares*
|
9
|
SOLE DISPOSITIVE POWER
-0-
|
10
|
SHARED DISPOSITIVE POWER
4,900,394 Class A Common Shares*
|
11
|
AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH PERSON
4,900,394 Class A Common Shares*
|
12
|
CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
|
¨
|
13
|
PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
6.6%
|
14
|
TYPE OF REPORTING PERSON
OO
|
|
|
|
|
|
*Includes 4,900,394 Class A Common Shares held in the form of 2,450,197
ADSs.
CUSIP No. 26853A100
|
SCHEDULE 13D
|
Page
4
of 10 Pages
|
Item 1.
|
SECURITY AND ISSUER
|
|
|
|
This statement on Schedule 13D (the "
Schedule 13D
") relates to the class A
common shares, par value $0.001 per share (the "
Class A Common Shares
")
of
eHi Car Services Limited
, a
corporation organized under the laws of the Cayman Islands
(the "
Issuer
"). The principal executive offices of the Issuer are located at Unit 12/F, Building No.5, Guosheng Center, 388 Daduhe Road, Shanghai, 200062, The People's Republic of China.
|
Item 2.
|
IDENTITY AND BACKGROUND
|
|
|
(a)
|
This statement is filed by:
|
|
|
|
(i)
|
Burford Capital
Investment Management LLC
, a Delaware limited liability company
("
BCIM
"), with respect to the Class A Common Shares directly held by GKC Strategic Value Master Fund, LP
("
GKC
"), to which it serves as investment manager; and
|
|
|
|
|
(ii)
|
Burford
Capital Limited, a company organized under the laws of Guernsey and traded on the AIM Market of the London Stock Exchange
("
BCL
"), with respect to the Class A Common Shares directly held by GKC.
|
|
|
|
The foregoing persons are hereinafter sometimes collectively referred to as the "
Reporting Persons
." Any disclosures herein with respect to persons other than the Reporting Persons are made on information and belief after making inquiry to the appropriate party.
|
|
|
|
The filing of this statement should not be construed in and of itself as an admission by any Reporting Person as to beneficial ownership of the securities reported herein.
|
|
|
|
BCIM is indirectly controlled by BCL.
|
|
|
(b)
|
The principal business address of BCIM is 353 N. Clark St., Suite 2700, Chicago, Illinois 60654. The principal business address of BCL is PO Box 282, Regency Court, Glategny Esplanade, St. Peter Port, Guernsey GY1 3RH.
|
|
|
(c)
|
The principal business of BCIM is to provide investment advisory services. The principal business of BCL is finance for the legal industry.
|
|
|
(d)
|
The Reporting Persons have not, during the last five years, been convicted in a criminal proceeding (excluding traffic violations or similar misdemeanors).
|
|
|
CUSIP No. 26853A100
|
SCHEDULE 13D
|
Page
5
of 10 Pages
|
(e)
|
None of the Reporting Persons has, during the last five years, been a party to a civil proceeding of a judicial or administrative body of competent jurisdiction and, as a result of such proceeding, was, or is subject to, a judgment, decree or final order enjoining future violations of, or prohibiting or mandating activities subject to, federal or state securities laws or finding any violation with respect to such laws.
|
|
|
(f)
|
BCIM is a Delaware limited liability company. BCL is a Guernsey limited company.
|
|
|
|
Schedule A
attached hereto sets forth the information required by Instruction C of the instructions to Schedule 13D.
|
Item 3.
|
SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION
|
|
|
|
A total of approximately $32,808,138 was used to acquire the ADSs representing the Class A Common Shares reported in this Schedule 13D. The source of the funds used to acquire the ADSs representing the Class A Common Shares reported herein is the working capital of GKC.
|
Item 4.
|
PURPOSE OF TRANSACTION
|
|
On May 22, 2018, GKC sent a letter (the
"
Letter
") to Ray Ruiping Zhang, the Chairman of the Board of Directors of the Issuer (the "
Board
")
expressing its disappointment with the Issuer's sale process which the Reporting Persons believe is not being pursued in a competitive
and fair manner. The Letter requests that the Board consider the Ocean Link Consortium's offer which is $1.00 per ADS higher than
what is being offered by the Teamsport Consortium in the Agreement and Plan of Merger announced by the Issuer on April 6, 2018.
The foregoing summary of the Letter is qualified in its entirety by the full text of the Letter, which is filed as
Exhibit 2
to this Schedule 13D, and is incorporated herein by reference.
The Reporting Persons and their
representatives have, from time to time, engaged in discussions with certain of the following and may, from time to time, engage
in discussions with: members of management and the Board, other current or prospective shareholders, industry analysts, existing
or potential strategic partners or competitors, investment and financing professionals, sources of credit and other third parties
regarding a variety of matters relating to the Issuer, which may include, among other things, the Issuer’s strategic alternatives
and direction or strategic transactions in which the Reporting Persons may participate, business, management, capital structure
and allocation, corporate governance and Board composition, and may take other steps seeking to bring about changes to increase
shareholder value as well as pursue other plans or proposals that relate to or could result in any of the matters set forth in
clauses (a)-(j) of Item 4 of Schedule 13D.
|
CUSIP No. 26853A100
|
SCHEDULE 13D
|
Page
6
of 10 Pages
|
|
The Reporting Persons intend to review
their investment in the Issuer on a continuing basis. Depending on various factors, including, without limitation, the Issuer's
financial position and strategic direction, actions taken by management or the Board, the outcome of the discussions referenced
above, price levels of the Class A Common Shares and ADSs, other investment opportunities available to the Reporting Persons, conditions
in the securities market and general economic and industry conditions, the Reporting Persons may in the future take such actions
with respect to their investment in the Issuer as they deem appropriate, including, without limitation, exchanging information
with the Issuer or other third parties pursuant to appropriate confidentiality or similar agreements; proposing changes in the
Issuer's strategic direction, operations, management, Board, governance or capitalization, purchasing additional Class A Common
Shares or ADSs or selling some or all of their Class A Common Shares and ADSs, engaging in short selling of or any hedging or similar
transactions with respect to the Class A Common Shares and ADSs and/or otherwise changing their intention with respect to any and
all matters referred to in Item 4 of Schedule 13D. The Reporting Persons may, at any time and from time to time, review or reconsider
their position and/or change their purpose and/or formulate plans or proposals with respect to their investment in the Class A
Common Shares and ADSs.
|
|
|
|
Except as set forth herein and in Item
6 below, the Reporting Persons have no present plan or proposal that would relate to or result in any of the matters set forth
in subparagraphs (a)-(j) of Item 4 of Schedule 13D.
|
Item 5.
|
INTEREST IN SECURITIES OF THE ISSUER
|
|
|
(a)
|
See rows (11) and (13) of the cover pages to this Schedule 13D for the aggregate number of Shares and percentage of the Class A Common Shares beneficially owned by each of the Reporting Persons. The percentage used in this Schedule 13D is calculated based upon 74,279,018 Class A Common Shares outstanding as of December 31, 2017 as reported by the Issuer in its Annual Report for the fiscal year ended December 31, 2017 filed with the SEC on Form 20-F on April 30, 2018.
|
|
|
(b)
|
See rows (7) through (10) of the cover pages to this
Schedule 13D for the number of Class A Common Shares as to which each Reporting Person has the sole or shared power to vote
or direct the vote and sole or shared power to dispose or to direct the disposition.
|
|
|
(c)
|
Information concerning transactions in the ADSs effected by the Reporting Persons during the past sixty days is set forth in
Schedule B
hereto and is incorporated herein by reference. All of the transactions in ADSs listed hereto were effected in the open market through various brokerage entities.
|
|
|
(d)
|
No person other than the Reporting Persons or GKC is known to have the right to receive, or the power to direct the receipt of dividends from, or proceeds from the sale of the Class A Common Shares reported herein.
|
|
|
(e)
|
Not applicable.
|
CUSIP No. 26853A100
|
SCHEDULE 13D
|
Page
7
of 10 Pages
|
Item 6.
|
CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH RESPECT TO SECURITIES OF THE ISSUER
|
|
|
|
The Reporting Persons have a short position with respect to 500,000
ADSs, representing 1,000,000 Class A Common Shares.
Other than as described herein and the Joint Filing Agreement attached
as
Exhibit 1
hereto, there are no contracts, arrangements, understandings or relationships (legal or otherwise) between
the Reporting Persons and any other person with respect to any securities of the Issuer, including but not limited to, transfer
or voting of any of the Class A Common Shares, finder's fees, joint ventures, loan or option arrangements, puts or calls, guarantees
of profits, division of profits or loss, or the giving or withholding of proxies.
|
Item 7.
|
MATERIAL TO BE FILED AS EXHIBITS
|
|
|
Exhibit 1: Joint Filing Agreement as required by Rule 13d-1(k)(1)
under the Act.
|
|
Exhibit 2: Letter, dated May 22,
2018.
|
|
|
CUSIP No. 26853A100
|
SCHEDULE 13D
|
Page
8
of 10 Pages
|
SIGNATURES
After reasonable inquiry
and to the best of its knowledge and belief, the undersigned certifies that the information set forth in this statement is true,
complete and correct.
Date: May 22, 2018
BURFORD CAPITAL INVESTMENT MANAGEMENT LLC
|
|
|
|
/s/ Elizabeth O'Connell
|
|
Name: Elizabeth O'Connell
|
|
Title: Chief Financial Officer
|
|
|
|
BURFORD CAPITAL LIMITED
|
|
|
|
/s/ Mark Woodall
|
|
Name: Mark Woodall
|
|
Title: Director of International
Administration Group, as Company Secretary
|
|
|
|
CUSIP No. 26853A100
|
SCHEDULE 13D
|
Page
9
of 10 Pages
|
Schedule A
CONTROL PERSONS, DIRECTORS AND EXECUTIVE OFFICERS
OF CERTAIN REPORTING PERSONS
The following sets forth
the name, position, address, principal occupation and citizenship of each general partner, control person, director and/or executive
officer of the Reporting Persons (the "
Instruction C Persons
").
To the best
of the Reporting Person's knowledge, (i) none of the Instruction C Persons during the last five years has been convicted in a criminal
proceeding (excluding traffic violations or other similar misdemeanors) or been a party to a civil proceeding of a judicial or
administrative body of competent jurisdiction and as a result of such proceeding was or is subject to a judgment, decree or final
order enjoining future violations of, or prohibiting or mandating activities subject to, federal or state securities laws or finding
any violation with respect to such laws and (ii) none of the Instruction C Persons owns any Class A Common Shares or ADSs or is
party to any contract or agreement as would require disclosure in this Schedule 13D.
BCIM is indirectly controlled by BCL, which is controlled by the
following individuals:
Name
|
Position
|
Citizenship
|
Present Principal
Occupation
|
Business Address
|
Sir Peter Middleton
|
Chairman of the Board
|
UK
|
N/A
|
PO Box 282, Regency Court. Glategny Esplanade. St. Peter Port. Guernsey GY1 3RH
|
Hugh Steven Wilson
|
Vice Chairman of the Board
|
USA
|
Senior Adviser to Tennenbaum Capital Partners
|
PO Box 282, Regency Court. Glategny Esplanade. St. Peter Port. Guernsey GY1 3RH
|
David Charles Lowe
|
Board Director
|
UK
|
N/A
|
PO Box 282, Regency Court. Glategny Esplanade. St. Peter Port. Guernsey GY1 3RH
|
Charles Parkinson
|
Board Director
|
UK
|
Director of Bailiwick Investments Limited and Director of two private Guernsey investment companies, Mapeley Limited (owned by the Fortress Investment Group) and Aqua Resources Fund Limited
|
PO Box 282, Regency Court. Glategny Esplanade. St. Peter Port. Guernsey GY1 3RH
|
CUSIP No. 26853A100
|
SCHEDULE 13D
|
Page
10
of 10 Pages
|
Schedule B
This Schedule sets forth information
with respect to each purchase and sale of ADSs (each representing two Class A Common Shares) which was effectuated by the Reporting
Persons during the past sixty days. All transactions were effectuated in the open market through a broker.
Trade Date
|
ADSs Purchased (Sold)
|
Price Share ($)
|
4/16/2018
|
575,000
|
13.0584
|
4/16/2018
|
(125,000)*
|
13.0687
|
4/17/2018
|
191,321
|
13.2040
|
4/17/2018
|
(25,000)*
|
13.1189
|
4/23/2018
|
600,000
|
13.1068
|
4/23/2018
|
(80,000)*
|
13.1326
|
4/24/2018
|
49,540
|
13.0385
|
4/24/2018
|
(25,000)*
|
12.9984
|
4/25/2018
|
194,301
|
13.0847
|
4/25/2018
|
(35,000)*
|
13.0813
|
4/26/2018
|
55,887
|
13.0882
|
4/26/2018
|
(35,000)*
|
13.0131
|
4/30/2018
|
30,300
|
13.0549
|
4/30/2018
|
(25,000)*
|
13.0557
|
5/1/2018
|
45,459
|
13.0993
|
5/2/2018
|
71,038
|
13.1671
|
5/2/2018
|
(50,000)*
|
13.1322
|
5/3/2018
|
10,000
|
13.2249
|
5/8/2018
|
250,000
|
13.2651
|
5/10/2018
|
100,000
|
13.2471
|
5/10/2018
|
(50,000)*
|
13.2350
|
5/11/2018
|
30,000
|
13.2082
|
5/11/2018
|
(50,000)*
|
13.1990
|
5/14/2018
|
173,677
|
13.2601
|
5/15/2018
|
25,000
|
13.3786
|
5/16/2018
|
27,684
|
13.3581
|
5/18/2018
|
20,990
|
13.3219
|
*Denotes
short sales with respect to ADSs representing Class A Common Shares.
EXHIBIT 1
JOINT FILING AGREEMENT
PURSUANT TO RULE 13d-1(k)
The undersigned
acknowledge and agree that the foregoing statement on Schedule 13D is filed on behalf of each of the undersigned and that all subsequent
amendments to this statement on Schedule 13D shall be filed on behalf of each of the undersigned without the necessity of filing
additional joint filing agreements. The undersigned acknowledge that each shall be responsible for the timely filing of such amendments,
and for the completeness and accuracy of the information concerning him or it contained herein and therein, but shall not be responsible
for the completeness and accuracy of the information concerning the others, except to the extent that he or it knows or has reason
to believe that such information is inaccurate.
DATE: May 22, 2018
BURFORD CAPITAL INVESTMENT MANAGEMENT LLC
|
|
|
|
/s/ Elizabeth O'Connell
|
|
Name: Elizabeth O'Connell
|
|
Title: Chief Financial Officer
|
|
|
|
BURFORD CAPITAL LIMITED
|
|
|
|
/s/ Mark Woodall
|
|
Name: Mark Woodall
|
|
Title: Director of International Administration Group, as Company
Secretary
|
|
|
|
EXHIBIT 2
Ray Ruiping
Zhang
Chairman of
the Board
eHi Car Services Limited
Unit 12/F, Building No.5, Guosheng Center, 388 Daduhe Road
Shanghai,
200062
The People’s
Republic of China
Dear Mr. Zhang:
GKC Strategic Value Master Fund, LP is the beneficial owner of 4,900,394
Class A shares, via 2,450,197 American depositary shares (“ADS,” each representing two Class A shares) of eHi Car Services
Limited ("eHi" or the "Company").
We write to express our disappointment with eHi’s Board of
Directors’ (“Board”) decision not to pursue a competitive and fair sales process. We believe that this stems,
at least in part, from your consortium’s declaration that, as controller of 37.5% of the Company’s voting power, it
is “interested only in pursuing the Acquisition” and is “not interested in selling their shares in any other
transaction involving the Company.” Unfortunately, in recent years this has become a well-trodden path among companies incorporated
under the laws of the Cayman Islands: An insider with super-voting shares, backed by handpicked sponsors, squeezing out minority
shareholders at below fair value to pursue a transaction with no independent business purpose.
With respect to the inequitable nature of the sales process, we’d
note that the Board has flatly ignored a higher offer—namely, the Ocean Link Consortium’s proposal to purchase all
outstanding common shares of eHi in a going-private transaction for $14.50 per ADS, a price that is $1.00 per ADS higher than the
price offered by your Teamsport Consortium in the Agreement and Plan of Merger announced by eHi on April 6, 2018.
While we believe that the Company is worth substantially more than
$14.50 per ADS, the Board still is doing shareholders a grave disservice by ignoring Ocean Link’s proposal because such ‘topping
bids’ often engender the very price competition that will be needed to make eHi’s disinterested minority shareholders
whole.
The Board still has the opportunity to do right by eHi shareholders
and deem the competing bid “reasonably likely to lead to a Superior Proposal.” We hope that it does so.
But if the Board instead continues to ignore a conspicuously Superior
Proposal—despite its duty to shareholders—and the current Agreement and Plan of Merger is subsequently consummated,
we plan to exercise dissenters’ rights to receive payment of the fair value for our Class A shares.
Dissenters’ rights have, of late, become a last refuge for
disinterested shareholders of companies incorporated under the laws of the Cayman Islands. As touched upon above, shareholders
within the jurisdiction have been perpetually victimized by self-interested, uncompetitive, take-privates.
These iniquitous transactions are typically struck with the endgame
of relisting in China’s A-Share IPO market shortly after squeezing out minority shareholders at a fraction of the anticipated
IPO valuation.
This scheme has proven immensely profitable thus far: Research has
pegged the
average
relisting premium at several hundred percent compared to the “fair value” paid to erstwhile
minority shareholders who were unceremoniously squeezed out. The most recent relisting in this vein was that of Qihoo 360 Technology
Co. Ltd (“Qihoo”). After being taken private in July 2016 for $9.3 billion, Qihoo relisted in February 2018 at a valuation
of more than $60 billion. Qihoo’s CEO, who had spearheaded the take-private, reportedly made $12 billion alone upon relisting,
more than the valuation afforded to the entire company just 18 months earlier.
The free-for-all has even bred repeat players: Baring Private Equity,
a member of your Teamsport consortium, just recently squeezed out minority shareholders of Cayman-incorporated Nord Anglia Education,
Inc. (“Nord”) at a material discount to peers,
[1]
despite grievances from multiple key long-term shareholders who have since pursued dissenters’ rights. In fact, tellingly—and
remarkably—the Nord transaction was consummated despite a majority of minority shares either voting against or abstaining
entirely.
For the sake of eHi’s shareholders—as well as current
and future issuers who wish to abide by best-practices but are nonetheless penalized by a deepening “Cayman discount”—we
sincerely hope that a Qihoo or Nord-like result can be avoided here. To recapitulate, the Board still has an excellent opportunity
to endorse transparency and pursue best practices and we sincerely hope that it takes advantage of this opening.
Very Truly Yours,
/s/ Matthew J. Schoenfeld
Matthew J. Schoenfeld
Portfolio Manager
GKC Strategic Value Master Fund, LP
[1]
Nord’s minority shareholders were squeezed out at 15.1x Forward EBITDA (utilizing ~$4.3bln EV and 2018e EBITDA per Schedule
13E-3). Per Bloomberg financial data (function “FA”) Nord’s two closest peers, TAL Education Group (TAL) and
New Oriental Education & Technology Group Inc. (EDU) currently trade at 57.3x and 35.5x FY1 EBITDA, respectively,
representing
premia of 234% and 378%, respectively,
to the allegedly “fair” valuation at which Nord’s minority shareholders
were forced to sell their shares.