Three people familiar with the matter said that China’s antitrust regulator will formally block Tencent Holdings Ltd’s plan for a merger of the country’s two top videogame streaming sites, Huya and DouYu.
Two people said that Tencent has not come up with enough solutions to satisfy the State Administration of Market Regulation (SAMR), requirements regarding giving up exclusive rights.
After SAMR informed the company that it couldn’t complete the review within 180 days of its initial filing, the internet giant withdrew the merger request for antitrust review.
Because the information is confidential, the people did not want to be identified.
Tencent – China’s No. 1 social media and videogame company – Tencent, DouYu, and the SAMR didn’t immediately respond for comment.
Separately, Tencent’s plan to take private search engine Sogou (NYSE:SOGO) will be approved this month by SAMR, one of the people said. According to the report, the regulator was ready for approval in April.
Tencent announced its plans to merge Huya, DouYu, and other firms last year. The tie-up was designed to reduce its stakes in these companies. Data firm MobTech estimated that the market is worth more than $3B and growing rapidly.
Huya, DouYu, and No. 1, and No. 2. 2 respectively, are China’s most popular streaming video sites. Here users can watch professional gamers and watch e-sports tournaments.
Tencent, Huya’s largest shareholder, owns 36.9%. DouYu also has over a third. Both firms are listed in the United States and have a combined market value of $6 billion.
Barkha Jain is founder of TechVerbal. She is a techy nerd who loves to write about technology, new gadgets and crypto. She loves to travel and watch movies in her free time.