According to reports in Chinese local media, Huya and DouYu jointly announced that the two parties have signed a “merger agreement and plan”.
Based on the agreement, Huya will acquire all the outstanding shares of DouYu, including ordinary shares represented by American depositary shares, through a stock-for-stock merger. DouYu’s shares and ADS issued before the merger will be canceled. DouYu will become a private wholly-owned subsidiary of Huya and will be delisted from Nasdaq. On the completion of the merger, Huya’s current CEO Dong Rongjie and DouYu’s current CEO Chen Shaojie will become co-CEO of the combined company, and Chen will also become the tenth member of Huya’s board of directors.
In addition, Tencent will purchase 1.97 million Huya Class B common shares owned by Dong Rongjie, which is about 1.97 million Huya ADS; meanwhile, Tencent will purchase about 3.7 million DouYu common shares owned by Chen Shaojie, which is about 37 million DouYu ADS. It is expected that following the further acquisition of Huya shares, DouYu shares and the delivery of the merger, the voting rights in the combined company held by Tencent through its subsidiaries will be 67.5% on a fully diluted basis.
The merger of Huya and DouYu is promoted by Tencent, which means that two industry-leading live broadcast companies have been officially included under Tencent.