Youku & Tudou merge settles

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China’s top video streaming website Youku and its biggest former rival Tudou have officially merged on Monday. Youku & Tudou Group was born after today’s shareholder meeting in Hong Kong, giving the green light for a merger which had already been announced in March. The deal is valued at over 1 billion US dollars, and comes after both firms reported net losses last year. Laura Luo has the details.

China’s largest internet industry deal ever was finally approved by shareholders from both sides. The deal was settled through a 100 percent stock swap agreement. Youku’s shareholders own 71.5 percent of the combined company, and Tudou’s shareholders own 28.5 percent. Youku is the surviving entity in this transaction, with its shares continuing to trade on the New York Stock Exchange. However, Tudou’s shares will be delisted from both the Chinese and U.S markets.

Gu Yongqiang, CEO of Youku&Tudou Group, said,"The whole merger settlement process was very positive and successful. There is still a lot of work to be done, especially with the integration between the two teams, and business development needs beefing up too."

The new company is going to keep Tudou’s website, and its branding, but will work to improve its bandwidth capacities and purchase of film and TV rights.

Gu Yongqiang, CEO of Youku&Tudou Group, said,"In the long term, no matter what terminals customers are using to watch videos, whether tablets, mobile phones, or computers..... Youku & Tudou is going to provide the best experience. we are going to have many more innovations in future. "

Youku and Tudou are now covering 80 percent of the Chinese on-line video viewing market. Analysts say the merger will create a new leader in China’s on-line video market, bringing some relief to the companies’ financial struggles.