Sohu, Sogou and Tencent Jointly Announce Strategic Cooperation
BEIJING and SHENZHEN, Sept. 16, 2013
BEIJING and SHENZHEN, Sept. 16, 2013 /PRNewswire/ --Sohu.com Inc. ("Sohu",
NASDAQ: SOHU), Sogou Inc. ("Sogou") and Tencent Holdings Limited ("Tencent",
SEHK: 00700) jointly announced today the establishment of a strategic
cooperation that will reinforce and strengthen Sogou as a leader in the large
and fast-growing China market for search and internet services, particularly
for the mobile platform.
To implement this strategic cooperation, Tencent has invested a net amount of
US$448 million in cash in Sogou and merged its Soso search related businesses
and certain other assets with Sogou. Immediately after the transaction,
Tencent holds 36.5% of Sogou's equity capital on a fully-diluted basis, which
could further increase to approximately 40% in the near future. Sohu, together
with its affiliates, remains the controlling shareholder of Sogou, which will
continue to operate independently as a subsidiary of Sohu. Dr. Charles Zhang,
Sohu's Chairman and CEO, will remain as Chairman of Sogou. Mr. Martin Lau,
President of Tencent, and Mr. Mark Ren, Chief Operating Officer of Tencent,
have joined Sogou's Board of Directors. Mr. Wang Xiaochuan will continue to
lead Sogou as a director and CEO.
Tencent and Sogou have agreed to jointly develop, cross-promote and integrate
their respective products and services, while collaborating in areas of search
technology, user insights and data sharing. Sogou's leading products,
including Sogou Pinyin and Sogou Search, will have direct access to the vast
user base of Tencent's online and mobile social communities.
"This partnership will immediately expand Sogou's market presence and
significantly elevate its position in the highly competitive PC search market,
and even more so in the rapidly evolving mobile search market," stated Dr.
Charles Zhang, Chairman and CEO of Sohu. "Sogou remains a key strategic asset
of the Sohu Group, generating synergies with our other businesses and creating
significant value for Sohu shareholders."
"We are very excited about our combination with Soso and strategic partnership
with Tencent. By accessing Tencent's strong innovation capabilities and deeply
integrating with Tencent's core platform, Sogou will herald a new era of
relentless innovation in the mobile world," said Mr. Wang Xiaochuan, CEO of
Sogou. "For example, the optimization of Sogou Pinyin for Tencent's mobile IM
services will deliver superior user experience, while the interaction between
search and social network will bring a multitude of opportunities."
"We believe Sogou is the ideal partner for Tencent to further develop search
opportunities within China. This reinforces our "open, win-win" philosophy of
working with leading teams to create innovative products for users, and build
a healthy, diversified ecosystem for the industry," said Mr. Ma Huateng,
Chairman and CEO of Tencent. "We have high regard for Sogou's strong
innovation capabilities and successful execution track record. We are
confident that Sogou, after combination with Soso, will deliver superior
search experiences to users on our social, browser and content platforms,
especially on the mobile front."
Sogou has successfully executed a "Pinyin-Browser-Search" strategy and
launched numerous innovative products that have gained popularity among users,
including the No.1 Chinese character Pinyin input method on PC as measured by
user base and on mobile devices as measured by user penetration, according to
iResearch; the No.3 PC browser and No.3 PC search engine in China by page
views, according to CNZZ.
The transaction signed and closed simultaneously on September 16, 2013. Credit
Suisse acted as financial advisor to Sohu. Goldman Sachs acted as financial
advisor to Tencent.
Conference Call and Webcast
Sohu and Sogou's management team will host a conference call at 8:30 a.m. U.S.
Eastern Time, September 16, 2013 (8:30 p.m. Beijing/Hong Kong time, September
16, 2013) to discuss the transaction.
The dial-in details for the live conference call are:
US Toll-Free: +1-866-519-4004
Hong Kong: +852-2475-0994
China Mainland: +86-800-819-0121 / +86-400-620-8038
Please dial in 10 minutes before the call is scheduled to begin and provide
the passcode to join the call.
A telephone replay of the call will be available after the conclusion of the
conference call at 10:30 a.m. Eastern Time on September 16 through 11:59 p.m.
Eastern Time on September 23, 2013. The dial-in details for the telephone
The live webcast and archive of the conference call will be available on the
Investor Relations section of Sohu's website at http://investors.sohu.com/.
Sohu (NASDAQ: SOHU) is China's premier online brand and is indispensable to
the daily life of millions of Chinese, providing a network of web properties
and community based/web 2.0 products which offer the vast Sohu user community
a broad array of choices regarding information, entertainment and
communication. Sohu has built one of the most comprehensive matrices of
Chinese language web properties and proprietary search engines, consisting of
the mass portal and leading online media destination www.sohu.com; interactive
search engine www.sogou.com; developer and operator of online games
www.changyou.com/en/and leading online video website tv.sohu.com.
Sohu corporate services consist of online brand advertising on its matrix of
websites as well as bid listing and home page on its in-house developed search
directory and engine. Sohu also provides multiple news and information service
on mobile platforms, including Sohu News App and mobile news portal
WAP.Sohu.com. Sohu's online game subsidiary, Changyou.com (NASDAQ: CYOU) has a
diverse portfolio of online games that includes Tian Long Ba Bu, one of the
most popular massively multi-player online ("MMO") games in China, and DDTank
and Wartune (also known as Shen Qu), which are two popular web games in China.
Sohu.com, established by Dr. Charles Zhang, one of China's internet pioneers,
is in its seventeenth year of operation.
Sogou is a leading online search, client software and mobile Internet product
provider in China. Sogou has over 400 million monthly active users on PC and
more than 200 million monthly active users on mobile. Sogou provides superior
products to China's online users. Sogou Pinyin is No.1 Chinese language input
software on both PC and mobile; Sogou browser is No.3 web browser by market
share, and Sogou search is No.3 search engine in China by user penetration.
For mobile Internet, Sogou provides a range of innovative products, including
Map, Number Pass, Voice search and smart-phone assistant.
Tencent uses technology to enrich the lives of Internet users. Every day,
hundreds of millions of people communicate, share experiences, consume
information, seek entertainment, and shop online through our integrated
platforms. Our diversified services include QQ, Weixin and WeChat for
communications; Qzone for social networking; QQ Game Platform for online
games; QQ.com for information; as well as our eCommerce open platform. Our
company was founded in Shenzhen in 1998 and went public on the Hong Kong Stock
Exchange in 2004. We seek to evolve with the Internet by investing in
innovation, providing a hospitable environment for our partners, and staying
close to our users.
For more information, please visit www.tencent.com/ir
This press release contains forward-looking statements relating to the
business outlook, forecast business plans and growth strategies of Tencent,
Sohu and Sogou. These forward-looking statements are based on information
currently available to the companies and are stated herein on the basis of the
outlook at the time of this press release. They are based on certain
expectations, assumptions and premises, some of which are objective or beyond
each company's control. These forward-looking statements may prove to be
incorrect and may not be realized in future. Underlying the forward-looking
statements is a large number of risks and uncertainties. Further information
regarding these risks and uncertainties is included in the companies' other
public disclosure documents on their corporate websites.
For investor and media inquiries, please contact:
Tel: +86 (10) 6272 6593
Mr. Jeff Bloker
Tel: +1 (480) 614 3003
Catherine Chan or Jerry Huang
Tel: +86 755 8601 3388 ext 88369 or 65333
SOURCE Sohu.com Inc.
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