China's long-time online video rivals merged
时间：2012-03-13 07:26:36
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BEIJING, March 12 (Xinhua) -- Youku.com, China's largest online video company, said on Monday that it has inked a merger2 deal with its main rival, Tudou Holdings Ltd., in an unexpected move that the company claimed would form an industry leader in the world's biggest Internet market.
The two companies will
merge1 through a 100 percent stock
swap3 to forge a combined
entity4 named Youku Tudou Inc.
Once the deal is completed, Youku
shareholders5 and
holders6 of American depositary shares (ADS) will own about 71.5 percent of the new entity, and Tudou will get the remaining 28.5 percent.
With a market value of around 2.85 billion U.S. dollars, Youku is worth roughly six times more than the Nasdaq-listed Tudou.
Under the agreement terms, Tudou's shares will be canceled, while Youku's will continue to be traded on the New York Stock Exchange.
After the merger, the combined entity will hold more than a third of the country's online video
advertising7 market, according to the Internet research firm Analysis International.
However, the move came as a surprise as the two companies had been engaged in a bitter
rivalry8 involving allegations of copyright
misuse9 and unfair competitive practices.
Last month, Youku filed a
lawsuit10 against Tudou, saying it suffered losses after Tudou accused it of
misusing11 copyrighted material.
Youku CEO Victor Koo seemed to
consign12 those disputes to the past when he said, "We expect to see significant synergies across a number of areas including
leveraging13 licensed14 content over a larger user base and realizing efficiencies in bandwidth management and other common expenses."
The merger is expected to be completed in the third quarter of 2012.
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