(Yicai Global) March 24 -- Douyu International Holdings said its planned merger with rival Huya is still waiting on approval from Chinese and US regulators, The Paper reported, citing an executive at the Chinese gaming platform.

If the combination is given the go ahead, the two platforms will deepen their cooperation with Tencent Holdings, which has invested in both companies, further enhancing the merged firm’s competitiveness, the person said.

Tencent is the biggest shareholder in Guangzhou-based Huya, with a 36.9 percent stake and 50.9 percent of the voting rights as of April 3 last year. Tencent is also the largest shareholder in Wuhan-based Douyu, with 38 percent of the equity.

The two firms announced their merger plan on Oct. 12 and hoped to finish the process in the first half of this year. Once completed, Douyu will delist from the Nasdaq to become a privately held unit of Huya, while Tencent will become the controlling shareholder with 67.5 percent of the voting rights in the new company.

The merged entity would have a combined share of China’s game-streaming market of more than 80 percent, according to data from MobTech.

But last December China’s State Administration for Market Regulation said it was reviewing the deal amid tighter supervision over monopolistic practices by internet platforms. In November, the watchdog issued draft anti-trust guidelines for the internet economy and its director said revision of the anti-monopoly law would be speeded up, along with further protection of consumers' rights and interests.

The SAMR also imposed fines in three merger cases – Alibaba Group’s deal with Intime Retail Group, China Literature’s purchase of New Classics Media, and Shenzhen Hive Box Technology’s acquisition of China Post Smart Logistics Technology -- for failure to provide full declarations in accordance with the law.

Douyu yesterday published its earnings results for the three months and year ended Dec. 31. It had an adjusted fourth-quarter net loss of CNY176.9 million (USD27 million), versus an adjusted net income of CNY186.4 million a year earlier, and revenue rose 10 percent to CNY2.3 billion. For the full year, adjusted net jumped 56 percent to CNY541.6 million on a 32 percent gain in net revenue CNY9.6 billion.

In the fourth quarter, average monthly active users rose 5.2 percent to 174 million from a year ago, with a rise in paid users of 4.6 percent to 7.6 million.

Douyu’s gaming division will continue to be the major contributor to the platform’s live streaming revenue, an executive said on its earnings conference call.

Shares in Douyu [NASDAQ: DOYU] closed down 5.8 percent yesterday at USD12.33. Huya [NYSE: HUYA] fell 9.2 percent to USD22.36.

Editor: Tom Litting