
China's Zhongji buys UK game developer from PE investors
Shanghai-listed Zhongji Investment Holding has won shareholder approval to acquire UK-based Jagex Games Studio, the VC-backed developer of online role-playing game "RuneScape," in a deal worth RMB1.63 billion ($240 million).
The proposed acquisition was announced in September. Zhongjisaid in a filing it will acquire a 51% stake in an investment entity - Hongtou Network - that owns all Jagex's assets from existing Chinese investor Shandong Honda. Shandong Honda, a Chinese iron ore miner which is also listed in Shanghai, is an affiliate of Zhongji. The two divisions are part of Shanghai Zhongji Enterprise Group, which is controlled by a Chinese couple.
In March, Shandong Honda and domestic PE firm Shanghai Pintian Venture Capital acquired shares in Jagex held by its existing VC and PE investors for RMB2 billion. It subsequently restructured the offshore assets under Hongtou Network.
Insight Venture Partners previously owned a majority stake in Jagex, with The Raine Group and Spectrum Equity holding minority interests, according to the filing. Jagex reported $88.4 million in revenue last year and made $36.1 million in net profit.
Originally a real estate developer, Zhongji recorded revenue of RMB1.84 billion last year, down from RMB2.8 billion in 2014. Following the acquisition of Jagex and the disposal of its construction interests, the company has transformed self into a gaming business, with a focus on helping foreign companies expand in China.
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