The Chinese company, Tencent Holding Limited has acquired the assets of iflix, a free and subscription video-on-demand service based in Malaysia. Though the deal amount hasn’t been disclosed, Variety, a US entertainment media outlet has said “the deal was worth several tens of millions of dollars” citing people with knowledge of the agreement.
Iflix was running its services in thirteen countries with South Asia as the center including Nepal. As per the company, iflix had more than 25 million users across South Asia. The company had invested a significant amount in backing up the local and international contents. As a result, the company was running out of balance and was reportedly looking for IPO, and coronavirus pandemic turned everything upside down.
The company had cut a significant number of staff as the company was on debt and wasn’t generating a considerable amount of money. The company, in September 2019 had just $12.5 million in reserve and that was expected to hold the company only till the end of November. The company hasn’t announced any additional funding after that.
Two Chinese companies were reportedly showing interest in iflix and Tencent Holdings bagged the deal. The deal amount being reported as ‘several of tens of millions of dollars’, the company was sold in really a low amount as the company had sought $1 billion valuations in 2019 when it planned a public listing in Australia.
As reported by Bloomberg’s report, Tencent isn’t taking on iflix’s debt making the deal lesser in value. Iflix had recently raised $348 million from several companies.
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Last year in 2019, Tencent Video, which has 110 million paid subscribers in China as of April 2020, had released WeTV in Thailand broadcasting original Chinese contents with Thai dubbing. The WeTV is serving content in collaboration with local partners. WeTV now operates in three countries including Indonesia and the Philippines.
Tencent wants WeTV to enter in South East Asian market to fight against crowded rivals including Netflix. So, to back up the original, local, and international contents, Tencent acquired the assets of iflix. By doing so, the WeTV now has access to ‘content, technology, and resources’ of iflix.
About the acquisition, Tencent has stated, “Through the purchase, WeTV will further extend our presence in the video streaming industry across Southeast Asia to reach a broader audience base within the region and to better serve our users with a better viewing experience.”
Although iflix is now acquired by Tencent, the majority staff of the iflix will still be working in the company. Tencent, on this topic, has said, “Our current priority is to ensure smooth integration with our existing business and also talent retention.”