Rumors have been spreading on Chinese technology sites that Sohu.com is going to acquire Chinagames.net. Although no clear comments on the issue have been given by Sohu, it has been disclosed by a well-informed source in the media that both sides have made some headway in their negotiations.
Currently , there are various views about the news in the Chinese press. Some analysts are doubtful whether Chinagames can be sold since it is a state-owned asset. Others believe it is possible because it has already separated from its parent company, Shenzhen Telecom, which is a state-owned enterprise.
Either way, the most important part of the transaction will be the transparency that this once state-owned enterprise can reveal to Sohu.com's investors. State-owned businesses often have messy financials, so proving to investors that the acquisition is in Sohu's best interests will be tough.