The valuation comes as a big surprise as it seems to be on the higher side, but then two media reports state figures that are in three figures million dollars — so the deal would actually likely be somewhere in between.

That Indian social media platform ShareChat’s parent company has bought the short-video platform of Times of India Group-backed MX Player, is a fact. While Reuters puts the deal size roughly at $700 million, moneycontrol.com quoted a figure of $ 600 million, adding the figure may change as the deal moves towards a closure.

So, the big deal news is that the parent company of ShareChat has acquired local rival MX’s short-video platform TakaTak in a roughly $700 million deal, two sources told Reuters, as competition heats up in the sector where foreign investors have placed major bets.

The two companies confirmed the deal in a statement but did not disclose financials.

Indian short-video apps have become popular since India banned ByteDance’s TikTok and some other Chinese apps in 2020 following an India-China border clash.

After TikTok was banned, ShareChat’s parent entity, Mohalla Tech, launched a similar short-video sharing app named Moj, which counts Meta Platforms Inc.’s Instagram Reels as a key rival.

In a cash-and-stock deal, ShareChat’s parent entity acquired MX’s short-video platform called TakaTak, the sources familiar with the transaction told Reuters.

In their statement, the companies said the two platforms together would have more than 300 million monthly users and nearly 250 billion monthly video views, creating what they dubbed as “the largest short video platform for Indians”.

ShareChat is valued at roughly $4 billion and counts Singapore’s Temasek Holdings and Twitter among its investors.

ShareChat has plans to deepen its use of artificial intelligence tools and reach a much wider audience as Moj has roughly 160 million users in India, while MX has roughly 100 million, said one of the sources.

According to moneycontrol.com, Mohalla Tech has over 2000 employees, and with the acquisition, 180 employees of MX TakaTak will join the firm. MX TakaTak will be rebranded  in roughly six months and the target for the closure of the deal was at the end of the month.

Quoting a RedSeer report, moneycontrol.com said that while Facebook’s short videos and Instagram’s Reels continue to dominate in the top 50 cities, its Indian counterparts like DailyHunt’s Josh, Moj, and MX TakaTak have a significant user base in the tier-2 and tier-3 cities.