Baofeng.com, an online entertainment firm listed on the Nasdaq-like ChiNext board, will spend 3.1 billion yuan (US$477 million) to acquire three firms to expand its business into game, film and overseas markets.
Using a mixture of shares and cash, Baofeng will use 1.08 billion yuan to buy 60 percent of film and online drama production firm of Straw Bear; 1.05 billion yuan for 100 percent stake in overseas game publishing and distribution firm Gumptech; and 975 million yuan to buy 100 percent of game developer Rapid Game, Baofeng said in a statement to the Shenzhen Stock Exchange yesterday.
Baofeng will use the stakes to expand into film production, game and overseas business. Its current business covers online video, virtual reality and smart TV business.
“We aim to establish a global online entertainment empire with a complete eco-system and data technology covering more than 100 million consumers,” said Feng Xin, CEO of Baofeng.
Baofeng expects to reap a combined profit of 1.21 billion yuan from its stakes in the three firms within three years between 2016 and 2018. The expected profit is a huge jump from the 252 million yuan profit between 2013 and 2015, the statement said.
Alibaba, Xiaomi and Letv have also invested to acquire firms to create complete eco-systems for software, hardware and Internet services to draw more consumers, according to industry observers.
Source: Shanghai Daily