Chinese tech giant Tencent is said to have approached Baidu to buy a stake in its Chinese video streaming platform iQiyi.
Launched in August 2018, iQiyi Sports is a joint venture between video platform iQiyi and Super Sports Media, the Chinese agency with activities in rights acquisition, streaming and sports content production.
Shares in iQIYI jumped as much as 38 per cent earlier this week following a Reuters report saying Tencent is eyeing an investment in the company.
Baidu currently owns a 56.2-per-cent stake in iQIYI and controls 92.7 per cent of the company’s voting shares.
The potential tie-up between Tencent and iQIYI would unite two streaming video powerhouses that each had more than 110 million paid subscribers at the end of March.
A deal would also lower marketing costs and enhance their negotiating power in producing and purchasing content. This combination would shift the dynamic of China’s online streaming market and give Tencent more control over its rival Alibaba.
In 2019, iQiyi Sport agreed a deal with Super Sports Media to show all 380 LaLiga games during the current 2019-20 season. Wuhan DDMC Culture, Super Sports Media’s parent company, extended its LaLiga rights agreement from 2019-20 to 2024-25 in a deal reported by SportBusiness Media last June.