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Video game livestreaming giants Huya and DouYu are merging, giving Tencent control of a US$10bil industry behemoth

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Huya is acquiring DouYu to create a US$10bil juggernaut in the video game livestreaming industry. Tencent, already China’s largest gaming company by revenue, will control two thirds of the new company.

A plan from Tencent Holdings to create a US$10bil Twitch-like livestreaming behemoth was officially set into motion on Monday when Huya announced a plan to merge with DouYu International Holdings, which is expected to delist from the Nasdaq in the coming months.

Before the announcement, Huya was valued at about US$5.8bil on the New York Stock Exchange while Douyu was valued at about US$4.7bil . The current plan will see Huya acquire all outstanding shares of DouYu in a stock-for-stock merger, resulting in the shareholders of each company holding about 50% of the combined company.

The impact of the merger could also extend beyond just livestreaming. The two companies have already been testing cloud gaming features that allow viewers to instantly run high-end games straight from the Web without any downloading necessary.

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