Hony, Suning to take controlling stake in China’s PPTV for $420m
Hony Capital and home appliance retailer Suning Commerce - also one of the PE firm's portfolio companies - will buy a controlling interest in Chinese online TV provider PPTV for $420 million. The deal, which values PPTV at approximately $568 million, creates an exit opportunity for the company’s existing VC backers.
According to a regulatory filing, Suning will pay $250 million to buy a 44% stake in PPTV, becoming the largest shareholder. Two Hony-operated vehicles - Exalt Spring and Virtue Faith Holdings - will put in the remaining $170 million. The private equity firm's ownership stake was not disclosed.
Several venture capital firms are expected to sell their shares during the transaction. Softbank China Venture Capital, Bluerun Venture, Draper Fisher Jurvetson between them own 22.86% of PPTV. Softbank Corporation and PPTV's management team hold 35% and 42.14%, respectively.
The deal is subject to Chinese regulatory approval.
Suning is keen to build its online business. Wei Sun, Suning's vice chairman, said via the company's Sina Weibo account: "It is a key step for Suning to transform itself to fully operate online."
PPTV is the largest online TV service in China with more than 340 million users, according to its website. It offers sports, entertainment, news and other video content.
In May, Chinese search engine giant Baidu paid $370 million for PPS' online video business. The Shanghai-based firm was founded in 2005 and claims to be the world's largest online video services provider.
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