Rumor: Perfect World Purchases Baidu's Online Literature Division for RMB 1 Bln
NetEase Tech, 6/20/16
Beijing-based online game developer and operator Perfect World has reportedly purchased the online and mobile literature business belonging to internet company Baidu (Nasdaq: BIDU) for RMB 1 bln, according to a source familiar with the matter. Baidu will retain a 20% stake in Baidu Literature and provide traffic support, said the source. Baidu Literature mainly operates mobile reading apps 91 PandaReader and Baidu Shucheng, as well as the literature and comics site Zongheng.com.
Baidu declined to comment on the matter.
Baidu previously purchased Zongheng from Perfect World in 2013 for RMB 191.5 mln. It merged the operations of Zongheng.com with Baidu Shucheng and 91 PandaReader in November 2014 to form Baidu Literature.
Editor's Note: In January this year, Chinese news media reported that Baidu was considering hiving off 9 subsidiaries, including Baidu Literature, for independent IPOs. Perfect World was also rumored to be in talks to purchase Baidu Literature in November last year. Since July 2015, Baidu has announced its intention or completed semi-independent spin-offs of O2O food delivery platform Baidu Takeout Delivery, handset management app 91 Desktop, mobile homework app Zuoyebang, mobile music platform Baidu Music, and online video platform Baidu Video. The company also announced in February this year that it had received a proposal from Robin Li, chairman and CEO of Baidu, and Gong Yu, CEO of iQiyi, proposing to acquire all of the outstanding shares of iQiyi at a valuation of USD 2.8 bln. For more information on Perfect World's rumored bid for Baidu Literature, the spin-offs undertaken by Baidu in recent months, as well as the iQiyi bid, please see "Rumor: Perfect World to Repurchase Baidu Literature for RMB 1.2 Bln," MD 11/12/15, "Rumor: Baidu to Spin Off and IPO Music, Literature, iQiyi, Other Businesses," MD 1/28/16, "Baidu to Spin Out O2O Food Delivery, Handset Manager Units," MD 7/28/15, "Baidu Spins Off Homework App Zuoyebang into Independent Company," MD 8/18/15, "Baidu Music, Taihe Music Group to Merge into New Company," MD 12/13/15, "Baidu Video to Be Spun Off, Secures RMB 1 Bln Funding," MD 4/20/16 and "CEOs of Baidu, iQiyi Offer USD 2.8 Bln to Acquire iQiyi," MD 2/12/16 issues.
Keywords: Perfect World Internet wireless mobile literature Baidu online literature Zongheng BIDU 91 PandaReader Baidu Literature M&A
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