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Tencent in Talks to Acquire Clash of Clans Developer Supercell: Report

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Tencent in Talks to Acquire Clash of Clans Developer Supercell: Report
Highlights
  • Tencent is looking to expand its gaming footprint to mobile devices.
  • It is in talks to acquire Clash of Clans maker Supercell.
  • Right now, SoftBank has a 73 percent stake in Supercell.

Chinese Internet giant Tencent is planning to purchase a majority stake in Clash of Clans and Clash Royale developer Supercell. Tencent already has a sizeable presence in the PC games space due to its ownership of Riot Games - maker of League of Legends, which is one of the most popular games right now.

Acquiring Supercell will ensure a lucrative entry point into the mobile games space. SoftBank currently owns a majority stake in the company. In 2013 it bought a 51 percent stake and raised it to 73 percent last year. According to The Wallstreet Journal, SoftBank is in talks with Tencent could be looking to sell.

(Also see: PC Games Outsold Mobile Games in 2015)

"SoftBank's portfolio of video-game companies is one area that is under scrutiny from company President Nikesh Arora, who in March was put in charge of its international investments and operations, a person familiar with the matter said," claims The Wallstreet Journal. "Any sale of such assets would help shore up SoftBank's balance sheet, which is saddled with more than $80 billion in net interest-bearing debt, about a third of which is tied to its struggling U.S. mobile carrier unit Sprint Corp."

However it isn't as straightforward as it seems. The report goes on to state that Tencent President Martin Lau and Chief Strategy Officer James Mitchell made a trip to Helsinki - where Supercell is based to convince its founders to support a sale. Given that it has complete operational freedom under SoftBank and that its founders have the option to veto the deal doesn't exactly help Tencent's chances.

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