China’s antitrust regulator approved Tencent Holdings Ltd’s plan to privatize US-listed search engine Sogou in a USD3.5 billion deal, a sign of relief for Tencent after Tencent-led merger deal on Douyu and Huya blocked by the State Administration for Market Regulation (SAMR) last week.
In September, 2020, Tencent announced to take Sogou private by acquiring 60% stake in the country’s third largest search engine that it didn’t already own.
The deal might help Tencent to take on dominance of Baidu in search engine market.
Sogou owns 30.5% market share of China’s search engine market, making it the third larges search engine after Baidu and Qihoo 360.
Tencent has been Sogou’s largest shareholder since 2013, owning 36.5 percent of the search engine after merged Sogou with its own Soso search.
Tencent is at the center of antitrust investigation that the State Administration for Market Regulation (SAMR) fined big tech firms including Tencent, Alibaba for failing to report past merger and acquisition deal.
On Saturday, SAMR also blocked the merger of Huya and Douyu International Holding, China’s two biggest video game live-streaming platform that Tencent owns controlling stakes in.
Pingwest previously reported that SAMR is on the track to crack down on Tencent Music Entertainment (TME) to give up exclusive streaming rights signed with music labels including Song Music, Universal Music Group and Warner Music Group, ending Tencent’s market dominance in the country’s music streaming market.
In March, Tencent’s founder and CEO Pony Ma made his last public appearance that he attended the National People’s Congress, the country’s annual parliamentary gathering, as a delegate member.
At the meeting, Ma met with Beijing’s antitrust authority to discuss compliance issues.
Answer reporters’ questions following the earnings announcement. Ma said the company was cooperating with regulators on compliance, including reviewing some of Tencent past investment.