In an attempt to tap into a gaming market worth more than $11 billion, Huya Inc. has agreed to purchase DouYu International Holdings Ltd. in an all-share deal.
The company officially announced on Monday that investors were offered 0.73 American depositary shares of Huya per each Douyu share. As a result, Douyu’s ADS value has been approximated at around $18.83 per share.
Tencent Holdings Ltd. will get 68% of the voting shares once the deal is done, since they own pieces of both companies. This is a major power play for them, for they’ll now control one of the biggest online live-streaming game sites in the world.
Indeed, not only is Douyu one of the most powerful gaming companies in the world, but the gaming industry as a whole is projected to generate an estimated $3.5 million in revenue this year.
Tencent will also likely merge Penguin eSports, another profitable game-streaming service they own, with their new acquisition. This transaction alone will be worth an estimated $500 million.
