Splash Damage has parted ways with Tencent

Gears Tactics — Image credit: Xbox Game Studios

Splash Damage, the UK-based game development studio, has been sold to private equity investors, ending its ownership under Chinese tech giant Tencent.

The company, still led by its current leadership, indicated that it won't be releasing further statements about the acquisition.

Established in 2001, Splash Damage earned recognition for creating the Enemy Territory extension for Wolfenstein. It later collaborated with Microsoft as a support studio on multiple projects within the Gears of War series.

Back in 2016, Leyou, a Chinese poultry firm, acquired Splash Damage. Leyou had previously taken a majority stake in Digital Extremes, known for developing Warframe.

Tencent expanded its gaming division in 2020 by acquiring Leyou Technologies for approximately $1.3 billion, bringing Splash Damage under its umbrella.

Richard Jolly, CEO of Splash Damage, shared an optimistic outlook for the studio's future during a 2021 interview with GamesIndustry.biz after the Tencent acquisition.

"We've got some very ambitious plans for our next decade that we had already started on before the acquisition," Jolly stated. "Now, we're able to accelerate those. As one of the founders of the studio, I can honestly say that this is the most excited I've ever been for where we're headed."

After announcing Transformers: Reactivate as a new project in 2022, the studio disclosed in 2023 that they were also developing an open-world survival game, known as Project Astrid.

In January of this year, however, Splash Damage revealed that Transformers: Reactivate had been cancelled, resulting in potential job losses. No reason for this decision was disclosed.

Yong-yi Zhu, a vice president at Tencent Games, highlighted Tencent's continued interest in Western game studios during an interview with GamesIndustry.biz.

"From my division's standpoint, we have no plans at present to withdraw. You may notice a decrease in investments in some areas, which I believe reflects the industry’s current dynamics," Zhu explained.