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The stock-for-stock merger deal between Huya and DouYu allows for a 15% jump for the latter

News arrived that the shares of DouYu International Holdings Limitedor more commonly known as DouYu, are attaining over 15% at the moment, from their merger deal. This profit is owning to the fact that the Chinese live-game streaming company agreed to a merger with Huya Inc. (HUYA)their competitor, through means of a stock-for-stock agreement. On the Nasdaq, DouYu is trading at $16.04, which is an increased $2.04 or 14.57% than the original market.

About: DouYu

DouYu is a live game-centric video streaming service, of Chinese origin, launched in 2014. It is the largest of its kind that can be found in China that works on both PC and mobile applications. Consequently, people consider it a pioneer in the eSports value series as well. The site has more than 163.6 million active monthly users, which exceeds the active users of Twitch by above 140 million monthly users. The headquarters sits in Wuhan, China.

In July of 2019, DouYu managed to raise a sum of $775 million via Initial Public Offering ( IPO) in the U.S., listing its name into the New York Stock Exchange or NasdaqAs such, in 2019, it became the largest Chinese IPO on Wall Street. Furthermore, DouYu made $73 million from advertisement revenues in 2018. Tencent has control over 37% of the company shares. The business is public and traded as NASDAQ: DOYU.

Regarding: Huya

Huya Live is of the same nature as DouYu, a live streaming platform, launched on November 24, 2014. It performs as Nimo TV on a global scale. Other than the generic sports and gaming videos, Huya also broadcasts other genres such as cooking or real-time streams. Similar to DouYu, it trades itself as NASDAQ: HUYATencent owns 50.1% of its shares, and JOYY owns another 43% of it. Initially, JOYY had the voting stake of 55.5% before Tencent took over some of it. Moreover, Huya Live possesses certain exclusive broadcast rights. These exclusive rights include South Korea’s professional eSports league, the LCK, that compete for the League of Legends.


Merger Deal: DouYu

On August 10, 2020, Huya and DouYu came to consent on the stock-for-stock merger deal with Tiger Company Limited. Tencent, which owns significant shares in both the companies, was pressing forward for the merger for quite some time. As per the merger, Huya or any of its subsidiaries will obtain all the remaining shares from DouYu. These shares also include the outstanding shares that the American depositary shares represent. The benefit for DouYu will be that the shareholders will receive several freshly issued Class A ordinary shares from Huya for each DouYu share. With the merger, DouYu now possesses around 165 million monthly active users and has gained a 34% jump in revenue, bringing it to $354.4 million.

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