Baidu buys PPS online video business for $370m
Louise Duffy | 08-05-2013
Chinese ISP Baidu has announced the acquisition of the online video business of Internet video provider PPS for US$370m.
Baidu and PPS expect the transaction to close in the second quarter of 2013, subject to customary closing conditions. Upon completion of the transaction, the PPS online video business will be consolidated into Baidu's financial statements. PPS's online video business will be merged with Baidu's own video platform iQiyi.
The combined entity will become China's largest online video platform by number of mobile users and video viewing time. PPS will continue to operate as a sub-brand of iQiyi.
iQiyi CEO Gong Yu said: "The merger of iQiyi and PPS's online video business is a major step toward consolidation in the industry and will contribute to the development of China's Internet video industry. The merger will generate significant synergies, and will provide for an improved user experience as well as more and better content. It will also deliver better marketing value and a wider range of options for advertisers. The merger of iQiyi and PPS - both companies with strong technology DNA - lays a solid foundation for iQiyi to become a great technology company with strong media DNA as well."
PPS founder and chairman Zhang Hongyu said: "As a leading Chinese online video brand with an eight year history, PPS has the opportunity to join with iQiyi in opening up future markets, and we are excited to be working together to reshape the industry. We will strive to maximize the value of our combined resources and integrated teams, and we will jointly contribute to the progress and maturation of China's video industry."
After the acquisition, Gong Yu will continue to be CEO of iQiyi. Zhang Hongyu and PPS president Xu Weifeng will serve as co-presidents at iQiyi, and will be in charge of the PPS sub-brand and new business development.