Modern Times Group (MTG), the parent company of ESL and DreamHack, has entered a binding term sheet with Chinese live streaming platform HUYA.
As things stand, the agreement will see HUYA acquire a minority interest in ESL and form a joint venture with the tournament organiser that focuses on Chinese esports.
If the deal goes through, the investment in ESL will cost HUYA $30 million (£24.8 million) in primary and secondary shares, according to the term sheet. MTG will remain as the majority owner in ESL.
Jørgen Madsen Lindemann, President of CEO of MTG discussed the deal: “We are excited to announce this term sheet for an important strategic partnership which provides us with a strong partner in Huya to pave the way for a successful ESL expansion into the thriving Chinese esport and gaming market in due time.”
HUYA and ESL will collaborate on local Chinese esports competitions that connect to ESL’s global tournament calendar. This initiative is an effort to ensure that as many Chinese players as possible are competing “on a global scale.”
Rongjie Dong, Chief Executive Officer of HUYA also commented: “We are pleased to establish a close partnership with ESL, which demonstrates Huya’s further penetration into the global esports sector. Together with ESL, we are thrilled to bring more world class global esports content to Chinese gaming enthusiasts.”
The terms of the deal are binding, with both the joint venture and the minority interest both being subject to due diligence.
Esports Insider says: This deal will see MTG expand into the Chinese esports market and give HUYA a much bigger presence in the Western market by association and investment, both developments are not small in scale by any means. It’ll be interesting to see what’s produced by the joint venture should everything come into fruition.