PPTV, a Chinese peer-to-peer video streaming service, has been be acquired by Hony Capital of Lenovo and Suning, a Chinese home appliance retailer, for $420 million, as reported by Sohu IT (report in Chinese).

A new company will be jointly established by Suning and Hony Capital in Hong Kong, with the former taking a controlling stake. Suning will announce it this afternoon, according to the report.

Update: Suning has announced that it will invest $250 million in PPTV to get 44% in stake, becoming the company’s biggest shareholder. The rest $170 million will come from Hony Capital. Thus PPTV is valued at about $568 million.

PPTV reportedly has been looking for a buyer for a long time and companies that showed interest including Alibaba Group, Baidu, Sohu and Youku. It’s direct competition, PPS, was acquired by Baidu for $370 million.

PPTV has raised five rounds of funding,

  • 500 thousand USD in seed funding from Softbank in June 2005.
  • Several million USD in Series A from Bluerun Ventures and Softbank in January 2006.
  • $21 million in Series B from DFJ and Softbank in September 2007.
  • More than RMB 100 million from unnamed investors in November 2009.
  • Softbank invested $250 million for a 35% stake in PPTV in 2012.

The company generated RMB800 million in total revenue from online advertising and user subscriptions in 2012, once disclosed by its CEO Vincent Tao.