GUANGZHOU and WUHAN,
China, Oct. 12, 2020
/PRNewswire/ -- HUYA Inc. ("Huya") (NYSE: HUYA) and DouYu
International Holdings Limited ("DouYu") (NASDAQ: DOYU) today
announced that they have entered into an Agreement and Plan of
Merger, dated October 12, 2020 (the
"Merger Agreement") with Tiger Company Ltd., a newly formed company
with limited liability incorporated under the laws of the
Cayman Islands and a direct wholly
owned subsidiary of Huya ("Merger Sub"), and, solely for the
limited purposes set forth therein, Nectarine Investment Limited
("Tencent"), a wholly owned
subsidiary of Tencent Holdings
Limited. Pursuant to the Merger Agreement, Huya will acquire all
the outstanding shares of DouYu, including ordinary shares
represented by American depositary shares, through a
stock-for-stock merger (the "Merger").
Pursuant to the Merger Agreement, at the effective time of the
Merger (the "Effective Time"), each ordinary share of DouYu (the
"DouYu Shares") issued and outstanding immediately prior to the
Effective Time (other than the DouYu Shares represented by American
depositary shares, each representing 1/10 of a DouYu Share (the
"DouYu ADSs"), the Excluded Shares and any Purported Dissenters
Shares, each as defined in the Merger Agreement) will be cancelled
in exchange for the right to receive 7.30 validly issued, fully
paid, non-assessable Class A ordinary shares of Huya (the
"Huya Class A Shares"), and each DouYu ADS issued and outstanding
immediately prior to the Effective Time will be cancelled in
exchange for the right, at the direction of DouYu's depositary
bank, to receive 0.730 American depositary shares of Huya, each
representing one Huya Class A Share. If the Merger is
completed, the shareholders of Huya and DouYu immediately prior to
the Merger, respectively, will each hold approximately 50% shares
of the combined company on a fully diluted basis.
Concurrently with the execution of the Merger Agreement, DouYu
and Tencent entered into a
Reassignment Agreement, dated October 12,
2020, pursuant to which Tencent will assign its interests in the game
live streaming business operated by the Tencent group under the "Penguin e-Sports" brand
(the "Penguin Business") to DouYu (the "Reassignment") and deepen
its business cooperation with DouYu in order to integrate the
Penguin Business with the business of the combined Huya and DouYu
upon the Merger, for a total consideration of US$500,000,000. The closing of the Reassignment
is conditioned on, and is expected to occur substantially
concurrently with, the closing of the Merger. The closing of the
Merger is also conditioned on, and is expected to occur
substantially concurrently with, the closing of the
Reassignment.
The special committee of Huya (the "Huya Special Committee") and
the special committee of DouYu (the "DouYu Special Committee"),
each consisting of only independent and disinterested directors,
led the negotiation of the Merger Agreement on behalf of their
respective companies. The board of directors of each of Huya and
DouYu, acting upon the unanimous recommendation of the respective
special committee, unanimously approved the Merger Agreement and
the Merger. The board of directors of DouYu also unanimously
resolved to recommend that DouYu's shareholders vote to approve the
Merger Agreement and the Merger. JOYY Inc., Huya's significant
shareholder, has also provided its written consent to the
execution, delivery and performance of the Merger Agreement by Huya
and the Merger Sub and the consummation of the transactions
contemplated under the Merger Agreement pursuant to Huya's
currently effective memorandum and articles of association.
The Merger, which is currently expected to close during the
first half of 2021, is subject to customary closing conditions
including the approval of the Merger Agreement and the Merger by an
affirmative vote of holders of the DouYu Shares representing at
least two-thirds of the voting power of the DouYu Shares present
and voting in person or by proxy as a single class at a meeting of
DouYu's shareholders which will be convened to consider the
approval of the Merger Agreement and the Merger. Tencent and Messrs. Shaojie Chen and Wenming
Zhang, the Chief Executive Officer and co-Chief Executive
Officer of DouYu, have agreed to vote all of the DouYu Shares and
DouYu ADSs they beneficially own, which collectively represent
approximately 54.6 % of the voting rights attached to the total
outstanding DouYu Shares as of the date of the Merger Agreement, in
favor of the authorization and approval of the Merger Agreement and
the Merger. There can be no assurance that the Merger will be
completed during the first half of 2021 or at all. If completed,
the Merger will result in DouYu becoming a privately-held and
wholly owned subsidiary of Huya and DouYu ADSs will no longer be
listed on The NASDAQ Global Select Market.
If the Merger is completed, Mr. Rongjie
Dong, the current Chief Executive Officer of Huya, and Mr.
Shaojie Chen, the current Chief
Executive Officer of DouYu, will be Co-Chief Executive Officers of
the combined company, and Mr. Shaojie
Chen, together with the members of Huya's board of directors
immediately prior to the Merger, including Mr. Rongjie Dong, will be the members of the board
of directors of the combined company.
Huya also announced today that, in accordance with the terms of
the Merger Agreement, its board of directors approved a cash
dividend in an aggregate amount of US$200,000,000 to be paid on or around the date
of the closing of the Merger and in no event later than 20 days
after the closing of the Merger to the holders of ordinary shares
of Huya whose names appear on Huya's register of members as of the
close of business on certain record date after the date when the
required DouYu shareholder approval is obtained and prior to the
closing of the Merger. Such record date and payment date will be
designated by Huya's authorized officer and will be announced
in due course.
DouYu also announced today that, in accordance with the terms of
the Merger Agreement, its board of directors approved a cash
dividend in an aggregate amount of US$60,000,000 to be paid on or around the date of
the closing of the Merger and in no event later than 20 days after
the closing of the Merger to the holders of ordinary shares of
DouYu whose names appear on DouYu's register of members as of the
close of business on certain record date after the date when the
required DouYu shareholder approval is obtained and prior to the
closing of the Merger. Such record date and payment date will be
designated by DouYu's authorized officer and will be announced in
due course.
Linen Investment Limited, a wholly-owned subsidiary of
Tencent Holdings Limited ("Linen"),
has entered into a share transfer agreement with affiliates of Mr.
Rongjie Dong, pursuant to which
Linen will, immediately before the closing of the Merger, purchase
from such affiliates of Mr. Rongjie Dong
1,970,804 Class B ordinary shares of Huya, subject to the
satisfaction of customary closing conditions (the "Additional
Acquisition of Huya Shares").
Tencent has also entered into a
separate share transfer agreement with Mr. Shaojie Chen, pursuant to which Tencent will, immediately before the closing of
the Merger, purchase from affiliates of Mr. Shaojie Chen that hold DouYu Shares, or certain
assignees as may be designated by Mr. Shaojie Chen subject to the restrictions set
forth in such share transfer agreement, 3,703,704 DouYu Shares
subject to the satisfaction of customary closing conditions (the
"Additional Acquisition of DouYu Shares").
It is expected that, immediately after the closing of the
Additional Acquisition of Huya Shares, the Additional Acquisition
of DouYu Shares and the closing of the Merger, Tencent
Holdings Limited's voting power in the combined company held
through its affiliates will be 67.5% on a fully-diluted basis.
Citigroup Global Markets Inc. is serving as independent
financial advisor to the Huya Special Committee. Skadden, Arps,
Slate, Meagher & Flom LLP is serving as U.S. legal advisor to
the Huya Special Committee. Haiwen & Partners is serving as PRC
legal advisor to the Huya Special Committee. Maples and Calder
(Hong Kong) LLP is serving as
Cayman Islands legal advisor to
the Huya Special Committee.
Morgan Stanley Asia Limited is serving as independent
financial advisor to the DouYu Special Committee. Davis Polk & Wardwell LLP is serving as U.S.
legal advisor to the DouYu Special Committee. Hankun Law is serving as PRC legal advisor to
the DouYu Special Committee. Ogier is serving as Cayman Islands legal advisor to the DouYu
Special Committee.
Goldman Sachs (Asia) L.L.C. is
serving as financial advisor to Tencent. Latham & Watkins LLP is serving as
U.S. legal advisor to Tencent. Zhong
Lun Law Firm is serving as PRC legal advisor to Tencent. Walkers is serving as Cayman Islands legal advisor to Tencent.
About HUYA Inc.
HUYA Inc. is a leading game live streaming platform in
China with a large and active game
live streaming community. The Company cooperates with e-sports
event organizers, as well as major game developers and publishers,
and has developed e-sports live streaming as one of the most
popular content genres on its platform. The Company has created an
engaged, interactive and immersive community for game enthusiasts
of China's young generation.
Building on its success in game live streaming, Huya has also
extended its content to other entertainment content genres. Huya's
open platform also functions as a marketplace for broadcasters and
talent agencies to congregate and closely collaborate with the
Company.
About DouYu International Holdings Limited
Headquartered in Wuhan, China,
DouYu International Holdings Limited (Nasdaq: DOYU) is a leading
game-centric live streaming platform in China and a pioneer in the eSports value
chain. DouYu operates its platform on both PC and mobile apps,
through which users can enjoy immersive and interactive games and
entertainment live streaming. DouYu's platform brings together a
deep pool of top live streamers. By providing a sustainable
streamer development system built on advanced technology
infrastructure and capabilities, DouYu helps ensure a consistent
supply of quality content. Through collaborations with a variety of
participants across the eSports value chain, the Company has gained
coveted access to a wide variety of premium eSports content, which
further attracts viewers and enhances user experience.
Safe Harbor Statement
This announcement contains forward-looking statements. These
statements are made under the "safe harbor" provisions of the U.S.
Private Securities Litigation Reform Act of 1995. These
forward-looking statements can be identified by terminology such as
"will," "expects," "anticipates," "future," "intends," "plans,"
"believes," "estimates" and similar statements. Among other things,
the transaction outlook and quotations from management in this
announcement, as well as Huya or DouYu's strategic and operational
plans, contain forward-looking statements. Huya or DouYu may also
make written or oral forward-looking statements in its periodic
reports to the U.S. Securities and Exchange Commission ("SEC"), in
its annual report to shareholders, in press releases and other
written materials and in oral statements made by its officers,
directors or employees to third parties. Statements that are not
historical facts, including statements about Huya or DouYu's
beliefs and expectations, are forward-looking statements.
Forward-looking statements involve inherent risks and
uncertainties. A number of factors could cause actual results to
differ materially from those contained in any forward-looking
statement, including but not limited to the following: Huya or
DouYu's goals and strategies; Huya or DouYu's future business
development, results of operations and financial condition; the
expected growth of the game live streaming market the expectation
regarding the rate at which to gain active users, especially paying
users; Huya or DouYu's ability to monetize the user base;
fluctuations in general economic and business conditions in
China; the impact of the COVID-19
to Huya or DouYu's business operations and the economy in
China and elsewhere generally; and
assumptions underlying or related to any of the foregoing. Further
information regarding these and other risks is included in Huya and
DouYu's filings with the SEC. All information provided in this
press release and in the attachments is as of the date of this
press release, and Huya and DouYu do not undertake any obligation
to update any forward-looking statement, except as required under
applicable law.
Additional Information
This press release relates to the proposed merger transaction
pursuant to the terms of the Merger Agreement. In connection with
the proposed transaction, Huya will file with the SEC a
registration statement on Form F-4 that will include a proxy
statement of DouYu that also constitutes a prospectus of Huya
relating to the proposed transaction. Huya and DouYu urge
investors and security holders to read the proxy
statement/prospectus and any other relevant documents filed with
the SEC carefully and in their entirety when they become available,
because they will contain important information about Huya, DouYu
and the proposed transaction. Investors and security holders
may obtain the registration statement and proxy
statement/prospectus (when they become available) and other
documents filed with the SEC free of charge at the SEC's website,
www.sec.gov.
This press release shall not constitute an offer to sell or the
solicitation of an offer to sell or the solicitation of an offer to
buy any securities, nor shall there be any sale of securities in
any jurisdiction in which such offer, solicitation or sale would be
unlawful prior to registration or qualification under the
securities laws of any such jurisdiction. No offer of securities
shall be made except by means of a prospectus meeting the
requirements of Section 10 of the Securities Act of 1933, as
amended.
For investor and media inquiries of Huya, please
contact:
In China:
HUYA Inc.
Investor Relations
Tel: +86-20-2290-7829
E-mail: ir@huya.com
The Piacente Group, Inc.
Jenny Cai
Tel: +86-10-6508-0677
E-mail: huya@tpg-ir.com
In the United States:
The Piacente Group, Inc.
Brandi Piacente
Tel: +1-212-481-2050
E-mail: huya@tpg-ir.com
For investor and media inquiries of DouYu, please
contact:
Investor Relations Contact
Mao Mao
DouYu International Holdings Limited
Email: ir@douyu.tv
Phone: +1 (646) 224-6934
Xinran Rao
ICR, Inc.
Email: DouYu.IR@icrinc.com
Phone: +1 (646) 224-6934
Media Relations Contact
Iris Ding
DouYu International Holdings Limited
Email: pr_douyu@douyu.tv
Phone: +1 (646) 308-1475
Edmond Lococo
ICR, Inc.
Email: DouYu.PR@icrinc.com
Phone: +1 (646) 308-1475
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SOURCE HUYA Inc.