Tencent acquired a stake in Chinese Game Science amid the unfavorable situation in the United States
The world leader buys a local indie studio a week after a new law is passed in the United States, which strikes at all public Chinese companies.
Let’s start with a little background. Last year, the Chinese role-playing action Black Myth: Wu Kong was announced, which is being developed based on the classic epic “Journey to the West“.
The project immediately attracted the attention of the media and the gaming community. There are many explanations for this, but the main thing is obvious: the gameplay demonstrated in the videos has a high level of production.
The Chinese Game Science Interactive Technology, which no one in the West knew about “yesterday”, showed a level of graphics (it’s not about technology, because Unreal Engine 4 is used here, but in general about art, animation, elaboration of details, etc.) comparable to leading Western blockbusters.
The uniqueness of the setting also played a role — medieval China, inhabited by anthropomorphic animals. As in “Journey to the West”, the main character of the game is a werewolf monkey, giving punches right and left with his magic staff.
And now, six months after the announcement, it becomes known that Tencent has bought a stake in the team that develops it.
We are talking about the acquisition by Tencent of a 5% minority asset from the previously independent Game Science Interactive Technology studio. She started in the middle of the tenth — in 2014 — with mobile games. Today it is based in two offices — in Hangzhou and Shenzhen, and focuses, judging by Black Myth: Wu Kong, on AAA development.
It is assumed that after the deal, the studio will remain autonomous. However, there are no details about the concluded contract — no specific amount, no additional conditions. It is also unclear whether Tencent plans to increase the size of its stake in the studio over time.
Important: So far, the only source of information about the purchase is Daniel Ahmad, a leading analyst at Niko Partners, who tracks major transactions and events in the Asia-Pacific region.
By the way, the purchase of a stake in a Chinese company takes place from Tencent against the background of the holding’s problems in the United States. The company’s music division, Tencent Music Entertainment Group, which is traded on the American stock exchange, lost 35% of its value last week.
One of the main reasons is the adoption by the US Securities and Exchange Commission of a law that prohibits the trading of shares on the US stock market to those companies that cannot provide the American level of audit.
This led to a collapse in the shares of a group of Chinese companies. Moreover, the Ministry of Foreign Affairs of China has already stated that such a step is aimed at discriminating against Chinese companies and is evidence of political pressure on them from the United States authorities.
Despite such a situation, of course, it would be too early and strange to say that the new Tencent deal, which has been actively investing mainly in foreign companies in recent years, is a kind of response to problems in the West. However, Tencent, striving for expansion into the global market, cannot but keep them in mind.
So it is quite reasonable for her to now not only buy Western companies, but also those local studios that attract the huge attention of the Western gaming community.
