China State Administration of Market Regulation is ready to clear tech giant Tencent Holdings Ltd.’s $3.5 billion deal to take search engine Sogou private, according to Reuters. Tencent must be willing to set up a special mechanism to ensure data security as part of SAMR deal approval
Tencent must pay a small fee, 500,000 Yuan or $76,000 for not reporting deals properly for antitrust reviews, in line with past cases for similar violations
The move signals that the regulator is willing to wave some deals through despite stepping sector scrutiny.
The green light for the closely watched deal comes as a relief for China’s tech sector, which has suffered from Beijing’s crackdown
Sogou only trails Baidu and Qihoo 360 in China’s internet search market and is the sole search engine on Tencent’s all-in-one mobile app WeChat.
A merger of China’s leading video games streaming sites Huya and Douyu, both backed by Tencent, is also under review for approval after concessions are made.Tencent and Sogou stocks are currently gaining. 0700: HKG is up 0081%, SOGO: NYSE is up 4.62% on premarket.
