Well, here’s a strange one: on Friday, Baidu said that it has received a nonbinding proposal to acquire its majority stake in video streaming site iQiyi. The guys who want to buy it up? Baidu’s own CEO Robin Li and iQiyi CEO Gong Yu.
Currently, Baidu owns an 80.5 percent stake in iQiyi. The offer, if it was finalized and accepted, would see that 80.5 percent going to Li and Gong, and iQiyi becoming an independent company again. iQiyi would remain a Baidu strategic partner, though, and would sign a cooperation agreement with Baidu.
Of course, this is all very tentative for now: what Li and Gong have submitted is not a binding offer, and there’s no guarantee that Baidu’s board would approve the sale anyway. Baidu does face strong competition in the streaming video sector, with competitors like Tencent and Alibaba (which recently bought out Youku) able to pour money into the market, and it has said that it expects content acquisition costs to rise. But whether that’s enough to make it dump its ties to iQiyi is an open question. For now, Baidu has created an independent committee to assess the idea and hired a legal firm to advise it.
The prospect has apparently excited investors tired of expensive content costs, though, as Baidu’s NASDAQ-listed stock (BIDU) shot up nearly five points when US markets opened Friday.
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