Its a foregone conclusion: Tencent general office appointed in June

category:Internet
 Its a foregone conclusion: Tencent general office appointed in June


In the afternoon of August 10, douyu announced that it had received the non binding preliminary proposal issued by Tencent holdings on the same day, proposing that douyu and Huya should be merged for share exchange. Huya will purchase the issued common shares (including common shares represented by American Depository shares) of douyu, and douyu shareholders will receive an agreed number of new class a common shares issued by Huya.

Chen Shaojie, founder and CEO of Betta, responded at the financial analysts meeting that night that he had just received the invitation from Tencent, and had not had time to evaluate and make specific decisions. Chen Shaojie said that the proposal of the merger invitation shows that Tencent has put the game live to a strategic position. Before that, Betta has already linked with Tencent in the game platform. In the future, there may be a live broadcast entrance in the game.

Shell finance reporter of Beijing News learned exclusively from a number of people close to the transaction that the merger is basically a foregone conclusion. This merger plan is the third time Tencent has put forward relevant suggestions, and even has risen to the level of Tencent general office. Several parties have started negotiations since the beginning of June this year. The form of financial transaction is similar to the merger of qunar and Ctrip, and the senior management of Betta may be retained to the senior management of the new company. After the combination, the positioning of Betta and Huya will be slightly different, and both the community and the short and medium-sized videos will be taken into account.

After the deal is concluded, a live broadcast platform with a market value of more than 10 billion yuan will be born in China, and the game live ecology will be further consolidated, and the ambition of the two to merge is not limited to live broadcasting. Then, the specific form of financial transactions, the future top management team, and the development direction of the two platforms after the merger have become the focus of the industry.

After the merger can increase profits, Betta executives or management of new companies

Tencent has tried to promote the merger of fighting fish and tiger teeth in the past two times. Once it was on the eve of the market, the market was worried about the interaction between the two stock prices. The other was the four quarter of 2019. The live broadcast of live games has already surpassed the fight between the fighting fish and tiger teeth. The Tencents investment in the Kwai Fu has not been repeated. Kwai once again proposed the plan to merge the fighting fish and tiger teeth.

Now, the merger plan of Betta and tiger tooth has finally surfaced after being discussed by the market for a long time.

The form of the transaction is similar to the merger of Ctrip and qunar, but different from TME (Tencent music and entertainment group), when TME merged, neither of them was listed. (douyu and Huya) are listed, they can only exchange one companys shares for anothers shares. This is only a financial (merger). In terms of operation and management, Betta executives may all remain in the senior management of the new company. People close to the deal, Li Ming (not his real name), told reporters.

In addition, some analysts said that the reason for replacing the douyu stock with tiger tooth stock is that the betta has issued more stocks and the equity is relatively dispersed. It can avoid the risk of more dispersed equity and obtain more financing with less equity.

In this matter of merger, Huya has been out of the game (referring to the fact that it has been controlled by Tencent), and Chen Shaojie is still at the negotiation table, a former Huya employee told shell finance reporter of Beijing News. Tiger tooth executives have reduced their holdings before, and there are also reductions in this transaction, said Li Ming.

According to the Q1 financial report of douyu and Huya in 2020, their revenue during the reporting period is 2.278 billion yuan and 2.412 billion yuan respectively, with non net profit of 260 million yuan and 219 million yuan respectively. According to the half yearly report released by Betta on August 10, its revenue was 4.786 billion yuan, and the non net profit was 596 million yuan.

According to the big data of Aurora, the coincidence rate of users of Betta and Huya is 31.6% in June 2020; from January to July 2020, the average daily active users of douyu and Huya are 13.569 million and 10.471 million, respectively, and the penetration rates are 4.2% and 3.9% respectively. Analysts believe that the high user coincidence rate may be the reason why the two platforms have not merged directly.

Liu Hao, an investor in the above-mentioned live broadcasting industry, said that both brands should be retained. As for how long, it is hard to say.

According to Tencents proposal, it has reached an agreement with joyy Inc. (hereinafter referred to as huanju group) which hatched Huya and Dong Rongjie, CEO of Huya, to purchase 30 million and 1 million class B ordinary shares of Huya from huanju group and Dong Rongjie respectively. The transfer will be completed on or before September 9, 2020, when Tencents shareholding in Huya will increase to 51.0% of the issued share capital of Huya, The voting rights will be increased to 70.4% of the total voting rights of Huya.

A person close to huanju group told shell finance reporter of Beijing news that the reduction of holdings will enable huanju group to obtain about 800 million US dollars of overseas cash, which is convenient for the company to obtain users, marketing and subsidies when going out to sea. At present, the most important strategy of huanju group is to go out to sea and artificial intelligence, with Japan, South Korea, Australia and Singapore as the focus, followed by the Middle East and Europe, And Southeast Asia. In addition, according to the previous non competition agreement signed between huanju group and Tencent holdings, huanju group has no plans to make live games in recent years.

Betta, tiger teeth will be differentiated, future power game community and short video

Zhao Miao (not his real name), a veteran of live broadcasting industry who has worked on many platforms such as Betta and byte skipping, analyzes that if the two platforms are leveled in terms of anchor resources and user resources, then the live broadcasting field will no longer be the focus of competition between the two, and the difference after the merger is the most noteworthy.

In the financial report released on August 10, Betta changed its positioning to diversified community direction with game as the core. According to the reporters understanding, the staff of the second Department of Betta R & D, whose office address is located in Beijing, expanded rapidly after the Spring Festival. The two-story office building in Wudaokou is extremely crowded, and the tea room is full of people.. And Betta has recently replaced its office location to the nearby Sohu building, and the rental space has been further expanded.

Shell finance reporter of Beijing News exclusively learned that the main work of the second Department of Betta R & D is to increase the short and medium video capacity of Betta. At present, we can see that there are many short videos in the live stream. It is not known whether to launch an independent application. In addition, the betta may also play a role in the game community.

To make short videos, Betta and tiger teeth are actually very advantageous. As long as we solve the problem of insufficient anchor capacity and algorithm recommendation, Zhao Miao told reporters.

He also analyzed that the game community driven distribution is an active attack method, and it is possible to win in this field, because the potential competitors are taptap (a game community developed by Shanghai easy to play) and some game core forums. Tiktok is a defensive tactic because the Kwai and the quick hands are less likely to win.

The advantage of fighting fish is its long established ecology, which make complaints about the citys game, and the management of the anchors, the wind control and the Tucao culture evolved from the two dimensional ecological evolution.

In terms of anchor ecology, Chen Shaojie, founder and CEO of Betta, once said at the analysts meeting in the first quarter of 2020 that the top 100 anchors have completed the renewal of their five-year contracts, and some even established associations jointly with Betta, which are deeply bound. In other words, if other platforms want to surpass Betta in terms of anchor ecology, they need to at least wait for the platform to cultivate a large number of high-quality anchors, or the above-mentioned anchor has passed the priority renewal period with Betta.

Another advantage of fighting fish is the community. The lucky thing about fighting fish is that they did it early and surrounded the core users of the game, and the whole platform atmosphere was very interesting. Zhang Wenming, co-founder and co CEO of the fish fighting, was introduced in an interview with shell finance reporter of the new Beijing newspaper earlier. In his view, most live broadcast emphasizes the interaction between the host and the user, while the fighting fish emphasizes the interaction between the host and the user, and emphasizes the interaction between users. In order to meet the needs of user communication, the fighting fish online has similar Fish Bar function.

Key Mr. Tencents pugc anxiety

The game live broadcasting industry has formed an industrial chain from game copyright, E-sports events to live broadcast platform, guild, anchor and derivatives, among which game copyright and E-sports events are the core. The direct and broadcast rights of a well-known E-sports event are in the tens of millions, or even more than 100 million. Tencent holds the upstream resources such as game copyright and E-sports events, which is also the key chip for Tencent to promote the merger of the two.

The above interviewees all think that Tencents merger proposal is basically a foregone conclusion.

In terms of equity, Tencent has cleared the barrier of huanju group by increasing its shareholding in early April, and has become the largest shareholder of douyu and Huya. According to the announcement, as of April 3, Tencent held 36.9% of the equity of Huya through its wholly-owned subsidiary, with 50.9% of the voting right. After the agreement in Septembers proposal was completed, Tencent owned 51.0% of the issued equity and 70.4% of the voting right. As of March 31, Tencent, through its wholly-owned subsidiary, holds 38% of the shares in Betta and 38% of the voting rights.

In terms of business, Tencent has been the largest institutional shareholder of douyu and Huya for a long time. No matter in the aspects of E-sports events, game promotion and anchor management, Tencent has experienced a long time of running in, and the integration is less difficult. According to shell finance reporter of Beijing News, although the douyu and Huya are invested by Tencents war investment department, an organization similar to live media has already been set up within Tencents mutual Entertainment Group (IEG) to coordinate the relationship between fish fighting, tiger teeth and Penguin video games, and to limit the job hopping behavior of the main broadcaster on the above three platforms.

Another example is that Tencent executives stationed in Huya are all responsible for specific business, not finance or investment. For example, Huang Lingdong, who was appointed chairman of Huya, is the general manager of Tencent interactive entertainment group. Before joining Tencent, he served as vice president of the ninth city of the game company; Xu Guang, appointed as director of Huya, is the general manager of Tencent interactive entertainment group, in charge of game distribution; PU Haitao, who is appointed as the director of Huya, is the general manager of Tencent, mainly responsible for mergers and acquisitions, capital and other related matters Legal field.

After several rounds of negotiation and psychological construction, the management of Tencent, douyu and Huya have changed their attitude towards the merger.

Behind this is Tencents tightening management of strategic investment enterprises in recent years, as well as Tencents anxiety in the field of pugc. From this year on, Tencent is also strengthening its control over strategic investment (holding) companies, such as the consolidation of Tencent music, Yuewen group and supercell, as well as the change of management of Yuewen group. A Tencent insider told shell finance reporter of Beijing News.

Tencents lack of a pugc platform, users quit the game, where to know the new game? Where to continue to watch the game related content? Tencent tiktok Kwai is sure that this part of the users will remain in their own ecosystem, but at present, these users are being attracted by B stations, jitter and fast hands. Internet analyst Tang Xin told the Beijing News shell financial reporter.

Tiktok, for Tencent, has been unable to compete with its rivals in terms of user volume, content ecology or technical system. It is urgent to make up the short board of Kwai PUGC after more than a years upward attack on the voice and quick hands. However, douyu and Huya have rich anchor resources, and they have their own system in content operation, but lack of traffic entrance, so it is logical to merge them. Liu Hao, an investor in the above-mentioned live broadcasting industry, told shell financial reporter of Beijing News.

What needs to be vigilant is that the long game video and the short game video are bypassing, seizing the users use time, and then the share of the game live broadcast. The former Huya employees said Tencent should consider how to strengthen the barriers of its live broadcasting platform. According to the information of Kwai Kwai, the gift income of fighting fish, tiger tooth, B station and fast hand in March 2020 was 974 million yuan, 818 million yuan, 1 billion 5 million yuan and 1 billion 749 million yuan respectively. In April 2020, the gift income of fighting fish, tiger tooth, B station and fast hand were 719 million yuan, 803 million yuan, 892 million yuan and 1 billion 905 million yuan respectively. That is to say, if the fighting fish and tiger teeth join forces, they can basically get a smooth balance between the live broadcasting industry and Kwai Chi, and surpass B station to form a balance. (Li Ming, Liu Hao, Wang Cong and Zhao Miao are all pseudonyms at the request of the interviewees) baijinglei, a shell finance reporter of Beijing News, proofread by Zhao Ze, editor of the Beijing News_ NT2541

What needs to be vigilant is that the long game video and the short game video are bypassing, seizing the users use time, and then the share of the game live broadcast. The former Huya employees said Tencent should consider how to strengthen the barriers of its live broadcasting platform.

According to the information of Kwai Kwai, the gift income of fighting fish, tiger tooth, B station and fast hand in March 2020 was 974 million yuan, 818 million yuan, 1 billion 5 million yuan and 1 billion 749 million yuan respectively. In April 2020, the gift income of fighting fish, tiger tooth, B station and fast hand were 719 million yuan, 803 million yuan, 892 million yuan and 1 billion 905 million yuan respectively. That is to say, if the fighting fish and tiger teeth join forces, they can basically get a smooth balance between the live broadcasting industry and Kwai Chi, and surpass B station to form a balance.

(at the request of the interviewees, Li Ming, Liu Hao, Wang Cong and Zhao Miao are pseudonyms.)

Beijing News shell financial reporter baijinglei editor Zhao Ze proofread Liu Jun