Youku Tudou’s American Depositary Shares were up 8.3 per cent at $26.50 in premarket trading on Friday, below the e-commerce giant’s offer of $27.60 per ADS.
Advertisement
At Friday’s announced price the deal is worth about $3.67 billion, net of $1.1 billion of Youku Tudou cash, for the 71.7% of Youku Tudou that Alibaba does not already own.
Youku Tudou chief executive Victor Koo, who owns around 18% of Youku Tudou, will remain CEO after the deal closes in the first quarter of 2016 (subject to the usual closing conditions).
The acquisition of Youku Tudou will allow Alibaba to add new marketing channels, as Youku Tudou plays host to a number of well-known Chinese video bloggers.
Youku Tudou is China’s leading Internet television platform, enabling users to search, view and share high-quality video content quickly and easily across multiple device. “We are eager to work with Alibaba to grow our multi-screen entertainment and media ecosystem”. The company, which has never posted a profit since its 2010 initial public offering, is zeroing in on US studios for programming.
When Alibaba first announced an offer for Youku Tudou on October 16, we wondered whether this was the death knell for Netflix Inc.’s (NASDAQ: NFLX) opportunity in China. The power of social media stars to promote consumer products is being tested by many businesses around the world – and is also testing regulators’ and viewers’ abilities to distinguish between unbiased content and paid promotion. The 52-week high of Youku Tudou Inc. These documents will be filed with or furnished to the SEC.
Youku Tudou Inc.is up 20.46% in the last 3-month period. The new price is 35 percent more than a day before an offer was initially disclosed. These forward-looking statements reflect expectations as of the date of this press release.
Advertisement
Youku Tudou’s board, acting on the recommendation of an independent special committee, unanimously approved the deal and recommends that shareholders vote to approve it.
