Modern Times Group (MTG), the parent company of ESL and DreamHack, has cancelled its term sheet with HUYA.
Announced in September last year, the Chinese live streaming platform was to acquire a minority interest in, and form a joint venture with, ESL.
Despite the “differing views” between MTG and HUYA on contractual risks and “other key commercial terms” that led to the termination of the term sheet, the former still plans to expand into the Chinese esports market.
Following the collapse of the negotiations, MTG’s share price took a sizable hit. The price was valued at 126.00 on January 20th and dropped to 107.00 the following day, marking a decrease of 15.08 percent from when the announcement was made.
Jørgen Madsen Lindemann, CEO and President of MTG discussed the decision in a release: “We still believe in the logic of this transaction and its potential for both MTG, HUYA, and for the esport industry globally. However, both parties see a mutual termination of the negotiations as the only way forward for now given the status of the negotiations at this stage. With that said, expansion into the important Chinese esport market continues to be a priority for MTG and we are looking forward to seize opportunities in the near future.”
The live streaming platform made a big play in its Western esports expansion earlier this week by partnering with Riot Games to broadcast the LCS and LEC in China.