The Chinese government is reportedly likely to thwart tech company Baidu’s US$3.6 billion acquisition of YY Live, the live streaming business of JOYY.
According to sources cited by Reuters, the Chinese antitrust regulator – the State Administration for Market Regulation (SAMR) – will not approve the deal as Beijing moves to rein in corporate expansion in the country.
Baidu first announced plans to by YY Live from social media company JOYY in November 2020.
The report goes on to note that Baidu had not received messages from regulators that the deal was unlikely to be approved.
However, SAMR has specifically targeted the deal as part of an ongoing crackdown of the videogame industry in China. It believes that giving Baidu a greenlight to invest in a videogame live streaming business could send the wrong message to the market.
The Chinese government last month introduced new rules that limit the amount of time that people under the age of 18 can spend on video games, and has criticised the entertainment industry for ‘polluting’ youth in the country.
One of the sources cited by Reuters said that SAMR will drag out the approval process until the application lapses or the companies withdraw it.
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