Kabam, the publisher of free-to-play mobile games, secured a $120 million investment from Alibaba, as part of what was said to be a strategic collaboration with the Chinese e-commerce giant.
Alibaba will publish Kabam’s free-to-play games across China through its mobile e-commerce app Taobao and mobile messaging platform Laiwang.
San Francisco-based Kabam will receive the investment subject to closing conditions. Terms of the deal were not disclosed.
However, Kent Wakeford, Kabam’s COO, told CNET that the agreement values the company at more than $1 billion.
“This strategic collaboration with Alibaba provides Kabam the resources, infrastructure and distribution to help bring our current and future durable franchise games to China and elsewhere in Asia and make an immediate impact,” Kevin Chou, Kabam CEO, said in a statement.
Patrick Liu, president of Alibaba Group’s digital entertainment business unit, added that his company is “committed to collaborating with great games companies like Kabam to deliver captivating digital entertainment offerings to our users”.
Kabam said it sees China and other Asian markets as playing a key role in its growth. It opened an office in Beijing four years ago where several of its most popular mobile titles were developed, including The Hobbit: Kingdoms of Middle-earth and Kingdoms of Camelot: Battle for the North. Both titles generated more than $100 million in revenue.
Kabam has also created the $50 million Worldwide Developer Fund, which brings games from Asian developers to a wider global audience.
The company, which also has operations in South Korea, UK, Germany and Canada, generated $360 million in revenue in 2013, a 100 per cent increase on the year before. Its efforts were helped by having two of the top ten grossing apps in Apple’s App Store.
Kabam has successfully transitioned from generating most of its revenue from Facebook games a few years ago to making much of its money through selling virtual goods in its free-to-play mobile games.
It develops its own products and publishes third party titles via Apple’s App Store, Google Play, Amazon Appstore and on the web, via Facebook Yahoo, Kabam.com and other platforms.
In June, it announced plans to bring its titles to Windows Phone and Windows-powered tablets, extending its reach beyond Android and iOS.
Previous investors in Kabam include Google Ventures, Warner Brothers, MGM and Intel.
Along with Japan’s SoftBank, Alibaba was this week linked to an investment in Snapchat, which could potentially value the maker of the photo messaging app at $10 billion.