Tencent’s $ 1.3 billion buyout of Sumo group investigated by US national security panel
The CFIUS has stepped up its review of the Chinese accords since the Trump administration.
Chinese video game giant Tencent acquired Sumo Group earlier in July this year for £ 919 million ($ 1.27 billion). He currently owns an 8.75% stake in the company whose subsidiary Sumo Digital has developed games like Sackboy: A Big Adventure, Hood Outlaws & Legends, Crackdown 3 and Team Sonic Racing. However, the acquisition is currently under investigation by a US national security panel.
According to a Reuters report, “Tencent had agreed to offer commitments to seek approval from the Committee on Foreign Investment in the United States (CFIUS), which evaluates the agreements to ensure they do not harm national security.
The report also claims that the committee has tightened its scrutiny of the Chinese deals since the Trump administration and is also currently investigating the US sale of TikTok. The two parties are said to be in talks with CFIUS to approve the acquisition before the end of the year.
The wave of video game studio acquisitions has shown no signs of abating. More recently Cyberpunk 2077 and CD Projekt Red, developer of The Witcher, acquired The Molasses Flood, the developer of popular survival and base-building games like Drake Hollow and The Flame in the Flood. Tencent’s biggest Chinese rival, NetEase, has acquired Grasshopper Manufacture, developer of No More Heroes, and is already aiming to bring “three better ‘Grasshopper Manufacture Games’ to all players over the next ten years.”
At the end of September, PlayStation announced the acquisition of Bluepoint Games, the developer of the Demon’s Souls and Shadow of the Colossus remakes. While that could mean a lot more remakes are on the cards for classic PlayStation games, Bluepoint Games President Marco Thrush said, “We have this original game development mindset in our hearts, […] this is the next evolutionary step for us. ”
To add to this, Xbox’s Phil Spencer noted that the company is not done with its acquisitions and is always on the lookout for new partners. “We’re always looking for people who we think would be a good game and teams who would be a good game with our strategy… we are certainly not done. There is no quota. There isn’t any sort of schedule where I have to go and acquire studios for a while.
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