SoftBank exits Finland's Supercell to Tencent in $10.2b deal

The Chinese online giant will lead a consortium to acquire up to 84% of the company, according to a release. Other participants in the consortium have not been identified. The remaining shares of the company will be held by employees of Supercell; Tencent plans to implement a new long-term incentive plan to buy employees' vested shares annually.

SoftBank acquired Supercell in 2013, buying a 51% stake for JPY150 billion (then $1.5 billion). Its games software unit GungHo Online Entertainment also participated, contributing 20% of the buying price. SoftBank raised its holding in Supercell to 73% last year, buying the remaining shares held by earlier investors Accel Partners and Index.

Supercell, whose products include the highly popular game Clash of Clans, will continue to be headquartered in Finland and no staffing changes are planned. The transaction is subject to regulatory approval and is expected to close by this September.

"Over the life of our investment, Supercell has operated as an independent company, and its unique culture of independent teams has proven itself repeatedly," said SoftBank Chairman and CEO Masayoshi Son. "I have great respect for Tencent and its leadership in games, and believe that with its commitment to respect Supercell's independence, Tencent represents the ideal partner to take Supercell's business to the next level."

SoftBank will also be exiting nearly all of its 23.5% stake in GungHo in a separate transaction, according to a disclosure. GungHo has tendered an offer to buy 248 million shares from SoftBank at JPY294 each, giving a total price of JPY72.9 billion. The deal will leave SoftBank with 24.3 million shares, a 2.3% stake.

The Supercell sale comes in the midst of a significant leadership change at SoftBank, as President and COO Nikesh Arora announced his departure from the company on the same day. Son, who had earlier indicated that he planned for Arora to succeed him soon, said that he had decided to stay on as CEO for the foreseeable future and wished to give Arora the freedom to pursue his own career path.

Arora has been under fire at SoftBank; the company earlier defended him against allegations of conflicts of interest and mismanagement. Those accusations were not mentioned in the announcement of his departure.

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