June 25, 2020 / 4:34 AM / 13 days ago

Tencent buys Malaysian streaming platform Iflix in SE Asia push

(Reuters) - Tencent said on Thursday it had purchased Malaysian video streaming platform Iflix’s “content, technology, and resources” in a bid to grow its presence in Southeast Asia.

FILE PHOTO: People visit Tencent's booth at the World 5G Exhibition in Beijing, China Nov. 22, 2019. REUTERS/Jason Lee/File Photo

The Chinese tech giant said in a statement that Iflix’s catalogue of “international, local, and original content” would enable it to expand the reach of its overseas video streaming service, WeTV, which it launched in Thailand in 2019.

A Tencent spokeswoman declined to disclose the size of the deal. U.S entertainment media outlet Variety, which first published the news on Wednesday, cited people with knowledge of the agreement as saying the deal was worth “several tens of millions of dollars.”

That would make the deal significantly smaller than the $1 billion valuation that Iflix had sought in 2019 when it planned a public listing in Australia.

The Malaysian startup, which had raised over $300 million, says it has more than 25 million active users in Southeast Asia. But it is facing significant accumulated losses and financial difficulties, according to two sources familiar with the company.

Iflix was not immediately available for comment.

The purchase comes as part of Tencent’s efforts to capitalise on its fast-growing userbase in the region of 650 million, where it operates music streaming service JOOX and popular game PlayerUnknown’s Battlegrounds.

Tencent Video, its streaming platform in China, boasted over 110 million paid subscribers at the end of March.

WeTV will face a crowded field in Southeast Asia, which includes U.S giant Netflix and Chinese rival iQIYI.

Reuters reported in June that Tencent was in early talks to become the biggest shareholder iQIYI. Both companies have declined to comment.

Reporting by Fanny Potkin. Editing by Gerry Doyle

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