Chinese e-commerce giant Alibaba is to acquire multi-screen entertainment and media company Youku Tudou, for around $3.7 billion. Alibaba already held 18.3 per cent of Youku Tudou, but last Friday offered to buy out the remaining 81.7 per cent of Youku Tudou for $26.60 a share.
Youku Tudou’s board of directors unanimously approved the merger agreement.
“We believe this combination with Alibaba maximises value for Youku Tudou shareholders and significantly benefits our customers, users and team,” said Victor Koo, chairman and CEO of Youku Tudou. “We are eager to work with Alibaba to grow our multi-screen entertainment and media ecosystem. We are confident that we will strengthen our market position and further accelerate our growth through the integration of our advertising and consumer businesses with Alibaba’s platform and Alipay services. With Alibaba’s support, Youku Tudou’s future as the leading multi-screen entertainment and media platform in China has been firmly secured.”
The deal, which is expected to close in the first quarter of 2016, is subject to conditions including the affirmative vote of the shares of Youku Tudou, representing at least two-thirds of the shares present and voting in person or by proxy as a single class at a general meeting of Youku Tudou’s shareholders.
Following the completion of the deal, Victor Koo will remain as chairman and CEO of Youku Tudou.