Chinese Tech Giant Baidu Scraps Live-Streaming Deal

Chinese Tech Giant Baidu's $3.6 billion deal to acquire YY Live has been scrapped due to regulatory. hurdles. Joyy Inc. faces uncertainties in deal
Baidu Scraps Live-Streaming Deal

Baidu Scraps Live-Streaming Deal

In a major blow to its diversification plans, Chinese tech giant Baidu has scrapped its high-profile $3.6 billion acquisition of YY Live, the popular live-streaming platform owned by Nasdaq-listed Joyy Inc. The deal, announced in 2020, was intended to propel Baidu into a leading position in China's booming live-streaming market but ultimately fell victim to regulatory roadblocks.

Key Takeaways:

  1. Baidu's $3.6 billion deal to acquire YY Live has been scrapped due to regulatory hurdles.
  2. The failure to secure approvals highlights increased scrutiny of the live-streaming industry in China.
  3. This sets back Baidu's diversification plans and raises questions about its future live-streaming strategy.
  4. Joyy Inc. faces uncertainties after the deal's collapse.

Deal Falls Through After Failing to Secure Approvals

Baidu cited the inability to obtain "necessary regulatory approvals" from authorities by the pre-set deadline of December 31, 2023, as the reason for terminating the share purchase agreement. This likely alludes to increased scrutiny from China's antitrust regulator amid concerns about data collection and potential monopolistic practices within the live-streaming industry.

Implications for Baidu and the Live-Streaming Landscape

The deal's collapse is a significant setback for Baidu's diversification efforts. Live-streaming had been identified as a key growth area, and the YY Live acquisition would have provided a substantial foothold. The failure to close the deal raises questions about Baidu's future strategies in the live-streaming sector and its ability to compete with established players like Douyin and Kuaishou.

Uncertainty Hangs Over JOYY

 For Joyy Inc., the cancellation of the deal represents missed opportunities for expansion and capital injection. The company now faces the task of charting a new course for its live-streaming business in a landscape where regulatory headwinds remain a strong presence.

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