Chinese Online Video Companies Merge (YOKU, TUDO)

In an all-stock deal, China’s leading online video provider, Youku Inc. (NYSE: YOKU), is merging with Tudou Holdings Ltd. (NASDAQ: TUDO). Tudou shareholders will receive 7.177 shares of Yoku stock for each share of Tudou they hold. Holders of Tudou’s US ADSs — worth 4 shares of class A common stock — will receive 1.595 Youku ADSs in the exchange. One Youku ADS is equal to 18 shares of Youku class A common stock.

Youku’s market cap is about $1.93 billion, while Tudou’s is about $402 million. Youku shareholders will own approximately 71.5% of the combined entity, while Tudou’s owners will hold 28.5%.

Tudou had a miserable fourth quarter and the company’s shares fell sharply last week. Exploding costs more than cancelled out the effect of higher revenues for the company. Youku reported a net loss for 2011 this morning of $23 million, while Tudou’s loss for last year came in at $81.2 million.

The combined company will be called Youku Tudou Inc. and will continue to trade on the NYSE under the ‘YOKU’ symbol.

Youku ADSs are up about 13% in the pre-market this morning, at $28.30 in a 52-week range of $13.76-$69.95. Tudou’s ADSs have skyrocketed, up more than 190% to $29.61, a new 52-week high. The previous range is $9.50-27.91.

Sponsored: Tips for Investing

A financial advisor can help you understand the advantages and disadvantages of investment properties. Finding a qualified financial advisor doesn’t have to be hard. SmartAsset’s free tool matches you with up to three financial advisors who serve your area, and you can interview your advisor matches at no cost to decide which one is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, get started now.

Investing in real estate can diversify your portfolio. But expanding your horizons may add additional costs. If you’re an investor looking to minimize expenses, consider checking out online brokerages. They often offer low investment fees, helping you maximize your profit.