Pingzhi Information intends to acquire NetEase Cloud Reading’s core assets with a cash purchase of 150 million yuan plus 16.65 million yuan in stock. NetEase Cloud reads revenue of 314 million in 2019 and profits of 14.367 million. Net assets have been negative in 2018.

Editor’s note: This article comes from the WeChat public account “Sanwen Entertainment” (ID: hi3wyu) , Author San Wenyu, reproduced with permission.

Today (January 16), the listed company Hangzhou Pingzhi Information Technology Co., Ltd. announced that it intends to purchase Hangzhou Yunyue Reading Network Co., Ltd. by issuing shares and paying cash. (Including all core assets of Netease Cloud Reading Business) 100% equity.

Yunyue read 100% of the initial price of 166.6 million yuan, of which pingzhi information paid 9.99% in shares; 90.01% in cash, 150 million in cash.

Behind Netease's reading sales: annual income of 300 million, valuation of 167 million less than half of the distribution platform Youshu

After the transaction is completed, YunyueRead will become a wholly-owned subsidiary of Heizhi Information.

The announcement shows that YunyueRead was established on November 24, 2017. There is no specific business. Pingzhi Information acquired YunyueRead this time, mainly through the latter acquisition of NetEase. Cloud reading business.

Hangzhou Xinqi, as a performance promiser, promises: Yunyue Reading’s accumulated net profit in 2020-2022 will not be less than 54.6 million yuan, and 2020-2022 net profit Not less than 15 million, 18 million and 21.6 million yuan, respectively.

If NetEase Cloud reads the results for the next three years without fulfilling the promised figures, Hangzhou Xinqi, a partnership company set up by NetEase employees, will be compensated, and the compensation amount will not exceed what they have obtained in this transaction (the initial price is 1665) Ten thousand shares).

Netease promises that within two years after the date of equity settlement of Yunyue Reading, the company and its related parties will no longer control the business competing with Yunyue Reading in any way (referring to Provide users with the uploading, publishing, reading and downloading services of Chinese original literary content via the Internet, excluding the provision of peripheral services such as promotion and payment for other companies / platform web-text services, and the audio book business of Netease Cloud Music).

NetEase’s guarantee does not restrict Snail Reading, Lofter, Youdao, Yidiyuan, Netease Cloud Music, Netease News and Information products (excluding this number) ) Non-serial, non-paid and non-signed Chinese original literature UGC columns (including the Netease News “Human” column), and novels adapted from Netease Game IP. However, these businesses must not involve Chinese online novels within two years.

Behind NetEase's reading sales: annual income of 300 million, valuation of 167 million less than half of the distribution platform Youshu

Netease also has a free and easy-to-read snail reading book with simple positioning.

The announcement also shows that the trademark “Netease Cloud Reading” and the domain name “yuedu.163.com” are only authorized for use by Yunyue Reading, not as an injected asset, and the authorization period Only 12 months from the date of asset delivery. Since the date of delivery, Yunyue Reading has gradually built its own website and applied for business qualifications within 12 months, and has the right to migrate the entire content of the yuedu.163.com website, user accounts and data to the self-built website to continue operations.

It seems that at the time, NetEase sold its comics business to Station B. It was a similar operation. Station B shut down the NetEase comics platform when it was acquired for 1 year ( Review:

Pingzhi information announcement shows that NetEase Cloud Reading has established stable digital content acquisition channels through establishing long-term cooperative relationships with many copyright institutions and authors, and has a high reputation in the industry. , Its new media team has unearthed a number of best-selling content such as “Innocent Murder” and “Desire to Power”, which are loved by users and highly praised by promoters. Netease Cloud Reading has nearly 30,000 novels, of which nearly 4,000 are exclusive copyrights, and the exclusive copyrights account for 13%. The brand effect of “NetEase” has also brought many positive effects to NetEase Cloud Reading.

However, despite the brand, technology, content, and users, NetEase Cloud’s performance figures are still not good. According to the simulated report published by Heiji Information, Netease Cloud reads 2018 revenue of 389 million yuan, loss of 19.84 million yuan, 2019 annual operating income of 314 million yuan, and profit of 14.376 million yuan.

Behind Netease's reading sales: annual revenue of 300 million, valuation of 167 million less than half of the distribution platform Youshu

also inToday (January 16), Heiji Information also announced that it intends to purchase 49% equity of Hangzhou Youshu Network Technology Co., Ltd. by issuing shares and paying cash.

Yushu was established in 2016, and Heiji Information has previously held 51% of the shares. Youshu is engaged in the novel distribution business by operating the “Youshuge” novel reading platform. In 2018, its operating income was 97.548 million yuan, with a net profit of 51.286 million yuan; in 2019, its operating income was 5.535.97 million yuan and its net profit was 22.0443 million yuan.

Youshu’s 49% equity was initially priced at RMB 191.1 million, of which 75% was paid in shares and 25% was paid in cash. The initial price of 100% equity of Yunyuedu was RMB 16665 million, of which 9.99% was paid in shares and 90.01% was paid in cash.

Behind Netease's reading sales: annual revenue of 300 million, valuation of 167 million less than half of the distribution platform Youshu

“Youshuge” gathers a large number of novel resources, and attracts users through WeChat public account, Weibo, QQ public account, QQ space, today ’s headline, etc., and ultimately consume Users read the novel content provided by the “Youshuge” novel reading platform through their respective media. The user’s recharge amount is divided between Youshu and the media operator, which is the CPS settlement model.

Behind Netease's reading sales: annual income of 300 million, valuation of 167 million less than half of the distribution platform Youshu

The picture on the homepage of Youshu website shows that many presidential articles are featured on the platform

This also means that Netease Cloud Reading’s self-assessment valuation has not yet reached 43% of the novel distribution platform Youshu. Pingzhi said that the “Youshuge” novel reading platform attracted a large number of WeChat public accounts to settle in. Youshu established a free reading station for it and linked the reading station to “Youshu The “Ge” novel reading platform can effectively distribute and deliver the novel content of Youshu to the market by taking advantage of the strong channel advantages of the media operator, making the audience face a geometric progression of growth relative to other business models.

Behind Netease's reading sales: annual income of 300 million, valuation of 167 million less than half of the distribution platform Youshu

Youshu shareholders Gongqingcheng has a book commitment: Youshu’s cumulative net profit from 2020-2022 is not less than 90 million yuan, and the net profit for 2020-2022 is respectively No less than 27 million, 30 million and 33 million yuan.