(Yicai Global) Dec. 15 -- Game-streaming giant Huya said it would cooperate with China’s market regulator after the watchdog announced a review of the company’s proposed merger with rival Douyu, the National Business Daily reported today.

As well as levying antitrust fines against three internet firms yesterday, the State Administration for Market Regulation revealed that it would also be looking into the planned combination of Huya and Douyu, both of which are backed by Tencent.

Guangzhou-based Huya said it had already applied to the SAMR for a review of the merger, and that it will “actively cooperate with the review procedures of the regulator.” 

The merger was announced on Oct. 12, with the expectation that it would be completed in the first half of next year. Once completed, Douyu would delist and become a wholly owned subsidiary of Huya, while Tencent would become the controlling shareholder with 67.5 percent of the voting rights of the new company. 

The merged entity would have a combined share of the Chinese game-streaming market of more than 80 percent, while Tencent is China's largest game publisher, according to data from MobTech.

Last year, Huya’s revenue reached CNY8.38 billion (USD1.28 billion), while Douyu made CNY7.28 billion, with their business concentrated in China. Tencent owns 36.8 of Huya with 50.9 percent of the voting rights. The Shenzhen-based tech titan also has 38 percent of Douyu.

Both Huya and Douyu are variable interest entities that went public on the New York Stock Exchange in May 2018 and the Nasdaq Stock Market in July 2019, respectively.

Editor: Tom Litting