Tencent is driving discussions to merge China’s biggest game-streaming platforms, Huya and DouYu International, people familiar with the matter said, in a deal that would allow it to dominate the US$3.4-billion arena.
The Chinese social media titan which owns a 37% stake in Huya and 38% of DouYu has been discussing such a merger with the duo over the past few months, although details have yet to be finalised, said the people, who asked not to be identified because discussions are private. Tencent is seeking to become the largest shareholder in the combined entity, one person said.
A deal would create an online giant with more than 300 million users and a combined market value of $10-billion, cementing Tencent’s lead in Chinese games and social media. Faced with rising competition for advertisers from ByteDance and its rapidly growing stable of apps, the WeChat operator would be able to sell ads across an expanded content network.
Huya and DouYu would keep their respective platforms and branding while working more closely with Tencent’s own e-sports site eGame, said the people.
Tencent and DouYu representatives declined to comment, while Huya spokespeople didn’t respond to requests for comment.