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Grand Tencent Auto? Tencent reportedly raising billions for acquisition of Take-Two Interactive or Electronic Arts

Tencent is looking to make a big investment in gaming. (Image Source: Jing Daily)
Tencent is looking to make a big investment in gaming. (Image Source: Jing Daily)
Tencent Holdings Limited is reportedly raising billions of dollars to acquire a US or South Korea-based gaming studio. Rumor is that the Chinese gaming major could be looking at acquiring Take-Two Interactive or Electronic Arts. There's also the other possibility that Tencent is raising funds to develop its own GTA competitor.

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Tencent Holdings Limited is a major gaming and internet services conglomerate based in China. The company owns popular game developers such as Riot Games and has a 40% stake in Epic Games along with sizeable investments in major studios such as Ubisoft, Activision Blizzard, Bluehole, and more.

In 2020, Tencent had closed 300% more deals than it had in the previous year. However, Tencent does not seem to be content and is looking to acquire a major US or South Korean-based game studio.

This report comes via TMT Finance, which states that Tencent is "considering raising several billion dollars in a "club" loan deal and is holding talks with lending banks as the company looks at a potential acquisition of a gaming business" (via Seeking Alpha).

Apparently, Tencent hasn't zeroed-in on a studio yet, but rumor is that the Chinese gaming major is eyeing one among Take-Two Interactive (owners of Rockstar Games and 2K Games), Electronic Arts, and Zynga. Just last week, Tencent acquired a majority stake in Canadian studio Klei Entertainment, creators of the Don't Starve IP.

It is still not confirmed if Tencent would actually look to acquire Take-Two, EA, or any other game studio. The potential South Korean companies that Tencent may be interested in include Netmarble and Nexon. There is also word that Tencent is actually raising money to build a Grand Theft Auto (GTA) competitor and not acquire any company.

Take-Two Interactive and Electronic Arts have market capitalizations of US$24 billion and US$43 billion, respectively. Aquisition of either company by Tencent, which has a market cap of US$854.35 billion, can have far-reaching implications for the gaming industry.

In theory, even if the said companies do not want to get acquired, Tencent can still pursue a hostile takeover without needing the approval of the respective boards. Fans, though, seem to prefer Microsoft or Sony to pitch in if Take-Two or any other big studio is indeed up for sale.

It remains to be seen what Tencent's plans are but as Jez Corden from Windows Central opines, in an era of market consolidation, many studios can be expected to be sold out over the next couple of years.

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Vaidyanathan Subramaniam
Vaidyanathan Subramaniam - Managing Editor - 1390 articles published on Notebookcheck since 2012
Though a cell and molecular biologist by training, I have been drawn towards computers from a very young age ever since I got my first PC in 1998. My passion for technology grew quite exponentially with the times, and it has been an incredible experience from being a much solicited source for tech advice and troubleshooting among family and friends to joining Notebookcheck in 2017 as a professional tech journalist. Now, I am a Lead Editor at Notebookcheck covering news and reviews encompassing a wide gamut of the technology landscape for Indian and global audiences. When I am not hunting for the next big story or taking complex measurements for reviews, you can find me unwinding to a nice read, listening to some soulful music, or trying out a new game.
contact me via: @Geeky_Vaidy
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> Notebook / Laptop Reviews and News > News > News Archive > Newsarchive 2021 01 > Grand Tencent Auto? Tencet reportedly raising billions for acquisition of Take-Two Interactive or Electronic Arts
Vaidyanathan Subramaniam, 2021-01-25 (Update: 2021-01-26)