China Literature, a pioneer in the online literature market, announced it will acquire a 100% equity stake in New Classics Media at a price of 15.5 billion yuan (US$2.25 billion), The Paper reported.

Founded in 2007, New Classics Media is mainly engaged in the production and distribution of TV dramas, online dramas and movies.

According to the agreement, the existing team of New Classics Media will continue to focus on their current business, and also have the right to select stories on the China Literature platform to develop into dramas and movies.

Tencent, as the largest shareholder of China Literature as well as the second largest shareholder of New Classics Media, will act as a seller in the transaction.

China Literature will pay Tencent 5.29 billion yuan for its holdings in New Classics Media and the settlement method will involve equivalent shares.