DOMESTIC online video site Bilibili is in talks to buy a 24 percent stake and the headquarters building of Yoozoo Games as part of a deal worth nearly 5 billion yuan (US$765 million), two people said, as it seeks to expand in the world’s top gaming market.

Bilibili is in talks on the deal with Xu Fenfen, chairwoman of Yoozoo, the video game company that is also known as Youzu Interactive, said the two people and another person with direct knowledge of the matter.

Last month, Bilibili and its founder Chen Rui submitted to Xu a term sheet, a non-binding agreement describing the basic terms and conditions of an investment, said the first two people.

This would be the latest acquisition for Bilibili, which is backed by Chinese technology giants Tencent Holdings and Alibaba Group Holding and started out as an animation site popular among teenagers. Last month, it raised about US$2.6 billion in a secondary listing in Hong Kong.

A Bilibili spokeswoman denied it was seeking a deal with Yoozoo. Shanghai-headquartered Yoozoo, which is the developer of the popular “Game of Thrones: Winter Is Coming” game, did not reply to a request for comment Thursday.

The US$44 billion Chinese gaming industry received a boost last year after the COVID-19 pandemic forced many residents to stay at home, driving up game downloads and boosting the revenues of the companies.

Gaming is seen as a steady revenue source as users tend to keep playing popular titles for years, and has become the main battlefield for market share, with other tech platforms, including ByteDance and Alibaba, also looking to expand. (SD-Agencies)