Chinese Merger Between DouYu and Huya Rejected

Chinese merger of Tencent financialy backed streaming technology companies rejected and blocked.

China’s State Administration for Market regulator has blocked and rejected a merger between DouYu and Huya backed by Tencent.

Chinese Merger Between DouYu and Huya Rejected
Chinese Merger Between DouYu and Huya Rejected

The reason behind the blockage and rejection of this merger is due to the anti-competitive edge which Tencent could achieve in China’s game streaming market.

DouYu and Huya are both game streaming platforms, the merger is backed by Tencent which would see Tencent growing its influence in the game streaming market.

According to some sources, Tencent failed to get permission from the State Administration of Market Regulations (SAMR). SAMR requirements demanded Tencent to give up its exclusive rights which Tencent failed to meet. Moreover, Tencent also withdrew the antitrust review application for the merger of DouYu and Huya. This withdrawal of application results in a wait of 180 days for the refiling application process according to the instructions given by SAMR.

Tencent’s plan to merge both these companies surfaced last year. Tencent has a majority stake in Huya and owns 38% shares in rival platform DouYu. With this merger, Tencent would have owned a lion’s share of 67% in the newly built after merger game streaming company. Moreover, this merger would have resulted in a consolidation of more than 80% of all game streaming markets in China.

[novashare_tweet tweet=”China’s State Administration for Market regulator has blocked and rejected a merger between DouYu and Huya backed by Tencent. The reason behind the blockage and rejection of this merger is due to the anti-competitive edge which Tencent could achieve in China’s game streaming market.” cta_text=”Chinese Big Tech Tencent Backed Merger Rejected and Blocked” hide_hashtags=”true”]

This would have meant that Ten-cent would have gotten hold of this chunk in the Chinese game streaming market. Thus comes the anti-competitive factor in this merger.

If things had gone according to the plans, this merger would have been completed during the first half of 2021. However, now China’s State Administration for Market Regulation has stepped in and rejected the merger altogether.

Chinese Merger Between DouYu and Huya Rejected
Chinese Merger Between DouYu and Huya Rejected

With anti-competitive and anti-trust lawsuits running rampant against big techs in the US and other parts of the world, Chinese authorities are also catching up.

Inside Gaming News 24/7 - Reinout te Brake -  Games Podcast - Game Consultant - Best Video Gaming News 2021
Inside Gaming News 24/7 – Reinout te Brake –  Games PodcastGame Consultant – Best Video Gaming News 2021 – Chinese Merger
Reinout te Brake

In a career spanning across 20+ years, Reinout te Brake has raised over 100+ Million Euros in Fundraising for a diversity of companies and has worked with several venture capitals firms. Helping gaming companies expand their brand reach, get the right story telling and make an impact on a global scale. Reinout te Brake has had the honor to counsel some of the major gaming companies operating on a global scale. For the last 12 years, he has devoted his major focus towards the niche of gaming consultancy to provide his insight and expertise to help gaming companies reach outstanding financial and business results.