Chinese internet giant Tencent, via its subsidiary Image Frame Investment, agreed deals to acquire a 9.9 per cent stake in mobile game developer Seasun for $142 million.
Image Frame Investment lined up a $62.2 million acquisition of a 4.3 per cent stake in Seasun from Kingsoft Entertainment, the game company’s parent. Tencent’s subsidiary then seperately proposed purchasing an additional 5.6 per cent of Seasun from WestGame Holdings, United Websoft and Xiaomi Ventures for an additional $80 million.
In a filing to the Hong Kong Stock Exchange, Kingsoft said Seasun has a “well-established business relationship with Tencent” adding: “the book value of the net assets of Seasun Group as at December 31 was CNY836 million” ($121 million).
“By introducing Tencent Group as a strategic investor in Seasun, Kingsoft believes that it will further strengthen the business cooperation in the game area between Seasun Group and Tencent Group in the future,” the filing said.
Seasun’s website said it is “China’s very first computer gaming studio”, formed in 1995, and is “now part of the $19 billion dollar Kingsoft Group.” The company produces mobile games including Brave Cross, GO Titans and Ships of Fury.
Kingsoft is a Chinese software and internet services company with four subsidiaries: Seasun, Cheetah Mobile (in which Tencent is a shareholder), Kingsoft Cloud and WPS.
“The two parties will cooperate and jointly draw on their complementary strengths so as to provide better entertainment experience for more end users… Enjoying the resources advantage of Tencent Group, Seasun Group will continue to expand its core end users and increase its market share,” the filing added.
Last month, Tencent invested in Chinese live broadcasting app maker Kuaishou ahead of a potential initial public offering, valuing the startup at about $3 billion.