Caixin
Apr 19, 2018 05:38 PM
BUSINESS & TECH

Tencent Tops Video-Game Deal-Making Leaderboard

A cellphone user plays Tencent Holding Ltd.’s “PlayerUnknown’s Battlegrounds.” Photo: IC
A cellphone user plays Tencent Holding Ltd.’s “PlayerUnknown’s Battlegrounds.” Photo: IC

Tencent Holdings Ltd. was the world’s biggest investor in video game companies in the 12 months ending March 31, an industry report said.

“Tencent led or participated in over $4 of every $10 invested in games companies worldwide” in the period, a report from Digi-Capital said Wednesday.

Tencent operates the world’s largest games business by revenue, thanks to its position in China, which according to data from consultancy Newzoo is the world’s top video-games market with estimated sales of $32.5 billion last year.

Tencent was involved in either the sell-side or buy-side of mergers and acquisitions that comprised over three-quarters of the total value of video game-sector deals made over the period, said Digi-Capital, a U.S.-based firm that advises on such deals and offers management consulting service.

Investment in the gaming industry over the same period hit a record high, with over $4.2 billion being poured into gaming companies, the consultancy said in a blog post.

Most of this money went into technology companies and online platform operators rather than game developers, a trend that has been developing over the last few years, the post added.

The blog post didn’t provide year-on-year comparison figures or say who the other top gaming deal-makers were over the period.

Early this month, Chinese online-game developer Shanda Games Ltd. invested 10 billion South Korean won ($9.3 million) into South Korean peer Kakao Games. Tencent holds a 3-billion-yuan ($478 million) stake in Shanda.

In March, Douyu and Huya — China’s two major video game livestreaming platforms — drew over $1 billion in financing from Tencent.

The Chinese titan the same month also spent 370 million euros ($457 million) for a 5% stake in French peer Ubisoft Entertainment SA, best known for its “Assassin’s Creed” series of games.

In June, Tencent also spent nearly $72 million for a 2% stake in Ourpalm Co. Ltd., a Chinese mobile-game developer listed in Shenzhen.

Contact reporter Jason Tan (jasontan@caixin.com)

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