CEO of Sogou Inc. Wang Xiaochuan (2nd L, Front) and CEO of sohu.com Zhang Chaoyang (1st R, Front) attend the opening bell ceremony at the New York Stock Exchange in New York, the United States, on Nov. 9, 2017. Sogou Inc., a Chinese search engine company backed by Tencent and Sohu, rang the New York Stock Exchange (NYSE) opening bell on Thursday in celebration of its initial public offerings (IPO). Shares of Sogou, trading under the ticker symbol "SOGO", started trading at 13 dollars per ADS on Thursday, and closed at 13.50 dollars apiece, rising 3.85 percent. (Xinhua/Wang Ying)

New York-listed Chinese search engine company Sogou has confirmed that it has received a preliminary non-binding proposal from domestic tech giant Tencent to acquire all of its shares at $9 per share. Tencent already holds a nearly 40 percent stake in Sogou. 

If the deal is successful, Sogou would delist from the US stock markets and become wholly owned by Tencent.

According to a report by cb.com.cn on Tuesday, Sogou said it would seriously weigh and discuss the relevant issues to "create more values for customers." It also thanked Tencent for its recognition of Sogou's values.

Xiang Ligang, director-general of the Beijing-based Information Consumption Alliance, said that Sogou, if backed by Tencent's resources and capital after the acquisition, will be able to snatch some search engine market share from Baidu, which currently has about 60-70 percent share in the market. 

"I believe Tencent has the ambition to challenge Baidu's dominant role in the search engine market, but the chances are small that Tencent or Sogou can overtake Baidu in the sector," Xiang told the Global Times, citing the latter's existing influence and the fact that Baidu must strike back should it face combined pressure from Tencent and Sogou.

Ma Jihua, a veteran telecommunications expert, also told the Global Times that Tencent is looking to acquire Sogou because it wants to make up for its technical weakness by absorbing Sogou's artificial intelligence technologies. 

He also noted that the pandemic, which has depressed advertisement spending, is exerting negative impact on companies like Sogou and will prompt those companies to consider acquisition bids. 

Tencent's acquisition proposal also comes as Chinese tech companies and services are facing rising hurdles in some overseas countries. Recently, the government of India banned 59 Chinese mobile applications including TikTok and WeChat as tensions arise between the two countries. 

According to experts, overseas blockades would cause tech companies to shift business strategies to the mainland market, including increasing investment in mainland companies. 

"Tech companies won't completely give up overseas markets despite external pressure, but I figure they will adjust strategies and direct business to countries which are more friendly to Chinese investment," Xiang said.