Mogujie to buy Tencent-backed rival Meilishuo

The two Chinese fashion, e-commerce startups are joining forces to form a new venture valued at some $3 billion as the industry consolidates amid a tougher fundraising climate.

Internet fashion start-up Mogujie is taking over key rival Meilishuo to form a new company valued at some $3 billion as China's e-commercial industry continues to consolidate amid fierce competition and a harder fundraising climate.

Mogujie, which means “Mushroom Street” in English, has agreed to acquire Tencent-backed Meilishuo, or “Beauty Talk”, through a 21 share swap, the online social-shopping firm said on Monday. 

As part of the deal Tencent will increase its stake in the new combined entity, Chen Qi, Mogujie’s founder and chief executive officer, said in an internal company communication seen by FinanceAsia, without providing further details.

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