Match Group looks beyond love with $1.73 billion Hyperconnect deal

(Reuters) - Match Group Inc has agreed to buy Softbank Group-backed South Korean social media firm Hyperconnect for $1.73 billion, as the owner of Tinder and Hinge looks beyond romantic connections to help users make friends across geographies.

FILE PHOTO: The dating app Tinder is shown on a mobile phone in this picture illustration taken September 1, 2020. REUTERS/Akhtar Soomro

The cash-and-stock deal announced by the companies on Tuesday marks the biggest acquisition deal so far by Match, which has kept users hooked to its offerings amid the COVID-19 pandemic by adding a slew of new features.

Seoul-based Hyperconnect was launched in 2014 and offers mainly two apps, Azar and Hakuna Live.

Azar, which has reported 540 million cumulative downloads so far, allows users to connect with others from around the world and instantly translates voice and text messages.

Hakuna Live, a live streaming app that allows a group of people to connect through video and audio broadcasts, has been downloaded more than 23 million times, with strong momentum in South Korea and Japan.

“With more than 75% of usage and revenue coming from markets spread across Asia, their product suite and regional footprint squarely complements our own,” Match Group Chief Executive Officer Shar Dubey said.

Match last week said Japan had become its second-highest grossing market behind the United States, with revenue in the Asian country surging more than 600% in the past five years.

Hyperconnect is profitable, the companies said, adding that it reported a 50% jump in 2020 revenue to more than $200 million.

Match’s flagship app Tinder, with 66 million average monthly active users, dominated the dating market worldwide with 53.8% of the market share during the final quarter of 2020, according to analytics firm Apptopia.

The deal with Hyperconnect is expected to close in the second quarter of 2021, and Match looks to fund the cash portion through cash on hand and existing debt.

Reporting by Tiyashi Datta and Noor Zainab Hussain in Bengaluru; Editing by Ramakrishnan M.