Korea’s gaming companies are increasingly looking for growth beyond its shores due to current market conditions
Tencent is the biggest foreign investor in Korean gaming companies
Korean developers are attracting increased interest from overseas firms. Tencent has already made a number of large-scale investments, and European companies are also actively seeking Korean gaming companies to bolster their growth.
Due to current market conditions, it is likely that the Korean gaming market growth will have stalled by 2015, so Korean game companies are also actively looking for growth engines, particularly in overseas markets. It is also widely recognised that Korean companies have extensive experience in building many of the most popular titles, and have been able to monetise effectively. Therefore, Korean game industry professionals are highly sought after by overseas companies, looking to achieve similar successes. Tough regulations to curb ‘gaming addiction’ in Korea has also had an impact on growth of the domestic market, leading further to diversification of the industry outside Korea.
According to industry sources quoted on Business Korea, “Chinese Internet companies like Tencent and Shanda Games have made almost US$1 billion of investment in Korea’s game and content developers.”
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Tencent has also just announced that it purchased an estimated 25 per cent stake in 4:33 Creative Lab, a Korean gaming company which gained industry repute for its popular titles, Blade and Arrow. The investment was made through a consortium established with Line. Tencent has reportedly invested around US$109.8 million into the consortium.
Incidentally, this is the third US$100 million investment in a Korean tech company from foreign investors this year.
Tencent has also invested in a number of other Korean gaming companies, such as Netmarble Games (US$512 million), Carbon Eyed (US$91.4 million), and PATI Games (US$18.3 million).
Shanda Games, again from China made a joint US$146 million acquisition of ActozSoft and Identity Games, bringing the total investment in Korean gaming companies by Chinese investors to around US$1 billion.
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