Chinese Internet Giant Buys A Stake In Another Big Game Developer
Tencent makes another movie.
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Tencent, the Chinese internet giant that already owns League of Legends developer Riot Games and has a big stake in Epic Games, has invested in another studio. According to GI.biz, Tencent paid £17.7 million to acquire a 9 percent stake in Frontier Developments, the UK-based studio behind Elite: Dangerous and Planet Coaster.
More specifically, Tencent picked up 3.37 million ordinary shares of Frontier (via Eurogamer). Frontier said it will use the funds to add to its existing £12.6 million in cash reserves, and also for investments in future growth.
Why is Tencent investing in Frontier? Chief strategy officer for the Chinese company, James Mitchell, said some of the reasons include Frontier's "highly scalable game engine technology, decades of development experience, and increasingly sophisticated live operations." Mitchell added that there is more interest in the Chinese market for games involving space exploration and theme parks.
For its part, Frontier CEO David Braben said, "This strategic investment will both help drive our scale up, and improve access, and accelerate our growth into the key Chinese market. Tencent will be a powerful partner for Frontier, in what will soon be the world's largest market for entertainment."
Tencent also owns Clash of Clans developer Supercell.
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