PE investors commit $850m to Tencent's Supercell acquisition

The Chinese company announced in June that it would lead a consortium in the acquisition of up to 84% of Supercell - including a 73% interest held by SoftBank - at an enterprise valuation of $10.2 billion. The other members of this consortium were not identified.

According to a more recent Tencent filing, the co-investors in the deal are CITIC Capital, Pagoda Investment, Aviation Industry Corporation of China-owned AVIC Capital, Zheng Hong Capital, and investment entities tied to China CITIC Bank, China Cinda Asset Management and Shanghai Pudong Development Bank. Zheng Hong is controlled by local conglomerate Jumbo Sheen Enterprises and a joint venture between Thailand's Charoen Pokphand Group and Japan's Itochu Corporation.

The consortium will own 76.9% of Supercell and Tencent's co-investors will hold a 50% voting interest in the acquisition vehicle. This means the vehicle would no longer be considered a subsidiary of Tencent.

Debtwire previously reported that the deal is supported by $3.5 billion in debt provided by 23 lenders, of which 13 are Chinese banks. The lead arrangers, book-runners and underwriters - Bank of China, Shanghai Pudong Development Bank, and China Merchants Bank - account for 60% of the final facility, with Bank of China alone committing $1 billion.

The minority interest in Supercell not held by the Tencent consortium will go to company management. Following the acquisition, Supercell will continue to be headquartered in Finland and no staffing changes are planned.

Best known for games such as "Clash of Clans," Supercell was acquired by SoftBank in 2013. The Japanese company paid JPY150 billion (then $1.5 billion) for a 51% interest, with its games software unit GungHo Online Entertainment contributed 20% of the cost. SoftBank raised its holding to 73% last year, buying the remaining shares held by earlier investors Accel Partners and Index.

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• Topics
• Greater China
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• Buyouts
• China
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• CITIC Capital