China has agreed to pay in 3.6 billion in cash for Internet search and AI giant Baidu, the Chinese live streaming business in Zhaoyai. The deal could help Baidu capture the fast-growing live and short video sector where it follows TicTac owner Bytens and social media leader Tencent.
Driven by a change in consumer behavior accelerated by the coronavirus epidemic, Baidu confirmed plans earlier this year to expand its existing short content streaming activities based on an application called Hawkan. Baidu is also the largest owner of the perennial Loxan-General streaming platform IQII.
The top-rumored receipt of JOYY’s China businesses takes Baidu significantly further towards the short form and could provide an advantage to the YYY live business it is buying.
“This transaction will transform Baidu into a leading platform for live streaming and diversify our source of revenue.” Baidur co-founder and CEO Robin Lee said in the filing.
Resources include the YY mobile app, the YY.com website and the PCY. The deal is expected to be completed in the first half of 2021.
YY hosted 41.2 million mobile MAUs in the second quarter of 2020 -%% more than a year ago. However, the number of paid users of YY dropped by 2% year-on-year to 4.1 million.
“YY Live is a great match for Baidu. You will benefit from YY Live Baidu’s huge traffic and rich mobile ecosystem, while Baidu will learn how to develop instant managed experience and large-scale video-based social media Together with the YY Live team, Baidu hopes to explore the next generation of live streaming and video-based social media that can expand beyond the various vertical entertainment on the Baidu platform. “
Listed on the Nasdaq Stock Exchange, Joyway is a China-based company that currently enjoys more than 90% of its earnings abroad. Its assets include the Singapore-based short video site Bigo. The sale of its YYY business in China is expected to give Joywai more investment opportunities in international business.
Live video gaming and e-commerce have become hugely popular in China. China’s live streaming leaders include Dwight of Bytendance and will soon merge Hua and Dewe, which have U.S. stock lists, but fall under the Tencent umbrella, among others in the fall streaming entertainment sector.
Baidu posted its third quarter financial results on Tuesday. Of these, RMB showed a slightly modified return of revenue and profit of 26.2 billion (4.16 billion.). Net profit for the three months to September was RMB13.7 billion (2.0 2.02 billion).
“Despite China experiencing a second wave of COVID-19 in July, our team executed the third quarter as proof of the sustainability of Baidur’s business, with top-line growth, stable profits and strong cash flow,” said Baidur CFO Herman Yu. .