China’s Tencent Folds Yet Another Video Game Company Into Its Empire
China’s Tencent, which already has ownership stakes and alliances with many major video game companies, has added another big name to the list.
Square Enix, makers of Final Fantasy and Tomb Raider, have signed a letter of intent to enter into a “strategic alliance” with Tencent Holdings Ltd. While the details of the partnership weren’t listed, one result will be a joint venture company that will create AAA games based on new intellectual properties and licensing existing ones.
“The alliance will enable us to couple our broad range of internet service capabilities to Square Enix Group’s superb creativity, and provide our customers with unprecedented content experiences on a global basis,” said Steven Ma, senior vice president of Tencent Group in a statement.
The partnership is the latest in a string of alliances Tencent has built in the video game industry. Over the past several years, it has become the world’s biggest gaming company, though is largely unknown to players.
How big is it? Here’s a look at some of its many holdings and alliances:
Tencent owns 40% of Epic Games, makers of Fortnite, which is on track to make $2 billion this year. To underscore the size of Tencent, analysts who cover the company said they haven’t yet factored the game’s impact on the company’s balance sheet.
In March, Ubisoft fended off the threat of a Vivendi takeover with Tencent’s help. The company bought a 5% stake in the French publisher and will help the game maker expand into China.
Tencent was one of a number of investors that helped CEO Bobby Kotick buy Activision back from Vivendi in 2013. It owns a 5% stake in the company and has helped bring Call of Duty Online to China as a free-to-play game.
After buying a majority ownership in the maker of League of Legends in 2011, Tencent completely bought the company in 2015. League of Legends has gone on to become one of the largest esports games around.
In 2016, Tencent bought a majority stake in the developer/publisher of Clash of Clans, one of the world’s highest grossing mobile games, for $8.6 billion
Take-Two Interactive Software
While it doesn’t have an ownership in the company behind Grand Theft Auto, Tencent and Take-Two have been partners since 2009, making the NBA 2K games available to play in China.