Tencent, a Chinese entertainment multinational and holding company, is the world’s largest gaming company. It plans to dive more into the Metaverse space.
Tencent Plans to Acquire Black Shark for its Metaverse Advancement
According to an announcement on January 10, Tencent plans to acquire Black Shark, a gaming smartphone company. Upon completion of the acquisition, Black Shark will be merged with Ren Yuxin-led Tencent Group PCG. Tencent did not want to comment on the takeover.
After the transaction is complete, the hardware manufacturer will conduct its own business transformation. Reports indicate that Black Shark’s future business focus will be expanded from gaming smartphones to entire VR devices – Tencent will provide content and Black Shark will provide hardware portals.
Black Shark was founded in 2017 and funded by Xiaomi. According to Tianyancha, a Chinese business inquiry platform, Tianjin Venture Capital Industrial Co., Ltd., wholly owned by Xiaomi, is the majority shareholder and holds 46.4% of the shares in Black Shark. Luo Yuzhou, co-founder and current CEO of Black Shark, was vice president of Huawei’s China Consumer Business. The takeover is also said to have been recognized by Xiaomi executives.
A source stated that Black Shark is valued at 3 billion yuan ($470.78 million) and Tencent has reduced it to around 2.6-2.7 billion yuan ($408.01-423.7 million).
Given other recent promotions from big players in the industry like Facebook and ByteDance, it’s only a matter of time before Tencent gets into the VR and AR fields. In July 2014, Facebook (now known as Meta) acquired Oculus for $2 billion, and its current shipments have exceeded 10 million units. In August 2021, Bytedance acquired Pico for 9 billion yuan ($1.41 billion).
Tencent obviously wants to seize this opportunity. After the company’s third-quarter financial report was released last year, on the performance conference call, Founder Ma Huateng emphasized that Tencent has many technologies and capabilities to research and develop Metaverse, which is reflected in the acquired brand. Tencent previously had registered trademarks such as King Metaverse, Tianmei Metaverse and QQ Metaverse.