Yesterday, the Chinese State Administration for Market Regulation (SAMR) said it would block Tencent Holdings’ plan to merge two of China’s leading video game streaming sites, Huya and DouYu, based on antitrust laws.
Tencent announced plans to merge Huya and DouYu last year, hoping to optimize its participation in companies that MobTech estimates have 80% of the $ 3 billion market and are growing rapidly.
Tencent is Huya’s largest shareholder with 36.9% and also owns more than a third of DouYu. Both companies are listed on the US market and have a combined market value of $ 5.3 billion.
According to SAMR, Huya and DouYu will have a combined market share of more than 70% in the video game streaming market and their merger will strengthen Tencent’s dominance in this market, given that Tencent already has more than 40% market share in the online gaming segment.
Tencent said it “will comply with the decision, comply with all regulatory requirements, act in accordance with applicable laws and regulations and fulfill its social obligations.”
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