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China's Toutiao to buy karaoke app for $800m

Deal Street Asia 2017-11-10 08:43:18

China’s Toutiao to buy karaoke app for $800m

Jinri Toutiao, the giant Chinese media startup, is close to acquiring buzzy teen social video app for about $800 million, according to people familiar with the deal.

Toutiao may announce a deal soon, the people said, asking not to be identified discussing a private matter. The acquisition represents the biggest venture abroad thus far for a Chinese startup valued at $20 billion that’s already one of the world’s largest news services.

Toutiao gains a big American presence, adding’s 100 million-strong contingent of lip-synching video performers to its own 120 million readers and viewers, while potentially tacking on a social media component to its bread-and-butter news offering., founded in Shanghai by Luyu Yang and Alex Zhu in 2014, exploded in popularity among American teens in 2016 and has since expanded beyond its flagship app for creating and sharing personal music videos.

In 2016, it rolled out a live-streaming app called The startup’s struck deals with media firms including Viacom Inc. and Comcast Corp.’s NBCUniversal to make original shows. Bloomberg has reported it’s also looking to make interactive content for a younger audience. Hearst’s “Seventeen” magazine has said it’ll devise a slate of shows focused on fashion and beauty for

Toutiao beat out rival bidders including Kuaishou, the viral video streaming service, the people said. Representatives for Toutiao and declined to comment.

Beijing ByteDance Technology Co.’s Jinri Toutiao — or “Today’s Headlines” — is one of the few Chinese internet operations to have found success without the backing of one of the country’s three biggest industry players: Tencent Holdings Ltd., Baidu Inc. and Alibaba Group Holding Ltd. Now all three are refining their own news apps to try and steal business from Toutiao.

Toutiao aggregates news and videos from hundreds of media outlets and has become one of the world’s largest news services in the span of five years. It was valued at more than $20 billion, according to a person familiar with the matter, on par with Elon Musk’s SpaceX. Started by Zhang Yiming, it’s on track to pull in about $2.5 billion in revenue this year, largely from advertising.