Tencent buys UK video game studio Sumo for $ 1.27 billion

In a busy year for game mergers, another deal has just been announced. Tencent to fully acquire Sumo Group, the UK developer behind LittleBigPlanet 3 and Repression 3. The Chinese web giant is offering 513 pence per share for the studio, in which it already has an 8.75% stake, valuing it at $ 1.26 billion (£ 990 million).

The acquisition brings another major developer into Tencent’s fold. Already the world’s largest games company, Tencent owns League of Legends studio Riot Games, and holds a financial stake in several publishers including Epic Games, Activision Blizzard, Ubisoft, Bluehole, Paradox Interactive, Supercell, Grinding Gear Games and Yager, as well as the Discord chat platform. In February, the company acquired a minority position in DayZ developer Bohemia Interactive.

But Tencent’s dominance has triggered a backlash in regulation at home and abroad. Earlier this month, Chinese authorities blocked plans to merge its two live game streaming sites, Douyu and Huya. Tencent is also negotiating deal with US national security panel that would allow it to retain stakes in US companies Riot Games and Epic Games, according to multiple reports.

The acquisition of Sumo provides Tencent with a mix of AAA and independent content. Next to LittleBigPlanet 3 and fallout Sackboy, both published by Sony, Sumo was also behind Hitman 2. He also owns UK independent developer The Chinese Room (Everyone’s gone for the kidnapping) and Red Kite Games, better known for porting games like Two-point hospital. In February, the studio bought PixelAnt Games in Poland for £ 250,000.

“The company will benefit from Tencent’s vast video game ecosystem, proven industry expertise and strategic resources, which will help secure and promote Sumo’s long-term aspirations and success,” said Ian Livingstone, President non-executive of Sumo, in a statement. .

Between Microsoft’s acquisition of ZeniMax and EA’s agreement for Codemasters, 2021 is already proving to be a successful year for video game consolidation. Other good deals include the acquisition of Epic Games by fall guys studio Mediatonic, the acquisition by Sony of Return developer Housmarque and the takeover of BigBox VR by Facebook via its Oculus branch.