Momo Acquires Dating App Tantan For $735 Million
China-based Momo (MOMO) will acquire dating app Tantan in a deal valued at $735 million, and Momo stock surged on the deal.
The deal gives a big boost to Momo's own dating business, which is based on a social networking platform that includes live streaming and is designed to help users expand social relationships. The $735 million deal to acquire Tantan consists of $601 million in cash and 5.3 million newly issued Class A ordinary shares, and is expected to close in the second quarter.
Momo stock jumped 17.1% to close at 35.75 on the stock market today.
Tantan is a leading social and dating app in China for the young generation, designed to help users meet people and find a romantic connection. Tantan said its platform has enabled more than 5 billion connections. The app is comparable to West Hollywood, Calif.-based Tinder, founded in 2012 and now owned by Match.com (MTCH).
Momo says it ended the third quarter with 94.4 million monthly active users, up 22% from the year-ago period. It had 4.1 million paying users of its live video-streaming business, the same as the previous quarter.
Momo reported third-quarter results on Nov. 28. Revenue of $354.5 million was up 126% from the year-ago period. Adjusted earnings were 45 cents, up 87%. The company held its initial public offering in December 2012.