China's largest online video company, Youku Inc, yesterday inked an agreement to merge with its immediate domestic rival, Tudou Holdings, through an all-share deal that is valued at more than $1 billion. The transaction will combine two companies that jointly account for one-third of China's online advertising market, yet it remains to be seen how dominant the new group will be.
The merger comes as a surprise since the two US-listed companies, which are referred to as China's equivalent of YouTube, have until recently been bitter competitors. Sources say the deal was agreed following several rounds of negotiations over the past few weeks, which underlines both parties' urge...
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