Baidu Completes Acquisition of JOYY’s YY Live Video Streaming Service for $2.1 Billion

JOYY Inc, a NASDAQ-listed company, has entered into agreements with Chinese tech giant Baidu to complete the sale of YY Live, its video-based entertainment live-streaming business in Mainland China. The latter paid approximately $240 million to close the deal, bringing the aggregate purchase price to $2.1 billion in cash.

Baidu paid $1.86 billion in February 2021 to acquire the live-streaming business. However, Reuters reported that the lack of regulatory approvals affected the original agreement of a $3.6 billion deal in 2020.

Baidu has been in the news for open-sourcing its AI models and its plan to make its AI chatbot available for free. In its Q4 FY 24 earnings, the company reported a 2% revenue decline to 34.12 billion yuan and a 26% growth in its cloud AI unit (to 7.1 billion yuan).

The acquisition has impacted the US-listed Baidu’s shares, which increased by 1%, while JOYY’s shares jumped by 6%. The report also mentions that Beijing has softened its stance towards the tech sector following a regulatory crackdown four years ago.

While it is unclear what closed the deal and caused the regulatory issues to reverse, the companies are said to have been in touch to resolve the issue. The company mentions that it plans to invest the funds in its cloud and AI infrastructure.

The acquisition will help Baidu diversify its revenue and better compete with online entertainment giants such as Douyin and TikTok's parent company, ByteDance.

Given the demand for streaming platforms like JioHotstar in India, which recently pulled off 60 crore live views, more companies across the globe may want to provide such video-streaming platforms.