China Literature, China’s largest online literature platform by various metrics, has agreed to take a 20% stake for USD 10.5 million in OBU via its wholly-owned subsidiary Cloundary, according to its regulatory filing with the Hong Kong bourse.
Ookbee U, or OBU, is a joint venture Tencent launched with Thailand’s e-books operator Ookbee.
The acquisition is banked on a fast-growing online literature market in Thailand, which enjoys the highest internet penetration among ASEAN countries, while the traditional publishing industry has been declining over the past years.
Tencent launched OBU as a JV with Ookee, which was founded in Thailand as an e-books and magazines startup across southeast Asia with presence in Thailand, Vietnam, the Philippines, and Malaysia. OBU was created to help identify and promote user-generated content to Southeast Asia, home to more than 600 million potential consumers.
Ookbee and Ookbee U claim a combined 10 million user pool and 350,000 content creators on their platforms across the region.
Under OBU there are several platforms catering to different types of content, including user-generated content (UGC) platform Tunwalai, UGC chat story platform Joylada, and UGC and professional-generated content platform Fictionlog.
Just like China Literature has help uncovered and made famous a raft of Chinese online writers, Ookbee U, according to Natavudh Pungcharoenpong, CEO at Ookbee, also would help “unearth star writers of the future.”
This investment involves connected transactions as Tencent is China Literature’s controlling shareholder and this Chinese internet giant’s wholly-owned subsidiary Kapok Tree holds a 42% stake in OBU before the announcement.
Kapok Tree will sell 10.2% of OBU’s total issued shares to Cloudary and Ookbee, a private company established in Thailand, will sell 3.2% of total issued shares to it. OBU will issue and allot 6.6% of its total issued shares to Cloudary.
Upon the completion of all transactions, OBU will be owned by Ookbee, Kapok Tree and Cloudary as to 51%, 29%, and 20%.