This is big. Chinese online video monoliths Youku and Tudou have announced the completion of their billion dollar merger, with the latter set to halt trading on the Nasdaq today.
The reason Tudou is the one to leave the stock market is because it’s now a wholly owned subsidiary of Youku, although the company will now officially be known as Youku Tudou Inc. That puts to rest Tudou’s earlier assertion that it would continue operating as a separate entity.
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The two video giants first announced plans for a merger back in March. Back then they suggested that the deal would completed in the third quarter of this year. According to The Next Web, the two companies could save as much as US$60-million in licensing fees.
When it was first announced the merger raised eyebrows, particularly given that the companies are more renowned for fierce legal battles than any sense of camaraderie.
While the new company will hold less than half of the Chinese video market, it’ll still very definitely a force to be reckoned with. Perhaps the biggest benefit though is that its alliance with social giant Sina Weibo carries a lot more clout.
Youku was founded in 2006 and was first listed on the New York Stock Exchange in December 2010.
Tudou meanwhile has been around since 2005. Earlier this year partnered with China’s biggest microblogging service Sina Weibo to allow any Sina Weibo user who isn’t already registered on Tudou to “upload and share videos seamlessly to and from Tudou’s video site”.
