Oh Fudge! Tencent buys 20% of Shift Up, the devs behind Stellar Blades

[shrike0fth0rns]

Well, Sony wouldn't be publishing the game if they didn't think it was going to be pretty dang good IMO.

At least it's just 20% though; I'm guessing if more shares are opened up and things work out well then Sony may buy shares themselves. The good news is, IIRC, Tencent are trying to distance themselves from affiliation with the CCP (which seems like it might be going through some issues itself WRT leadership). Although this veers into extreme/crazy speculation, I'm wondering if there's a sort of agreed-upon soft alliance going on with Sony & Tencent because they seem to be investing in a lot of the same pubs/devs of late, this is just the latest one.

Although if so I rue to think if/how MS would try to leverage that in some geopolitical sense to try getting the ABK acquisition pushed through. They could just stoop to that point if they feel forced. But they'd have nothing formal to point to, and if it doesn't work it would blow up in their face supremely.

But on the topic of studio investments though, I hope Sony are looking into the DokeV developer. That'd be such a great type of variety for PS5, and just thinking of the potential they, Team Asobi and Pixelopus is getting me insanely hyped.



When it comes to Sony making these types of investments, I trust that they're doing it off seeing some real results, not CG vertical slices and promising pitches. They've shown what pretty much appears to be gameplay already, and with the game due for 2023 I'm guessing we'll see more at a future State of Play or Showcase.

I'm personally pretty confident in Stellar Blade living up to anticipation. And yes, the helps

Also @shrike0fth0rns I just looked at Tencent's market cap and yeah, DAMN! That's almost half their 2020 valuation gone, pretty scary valuation losses there.

No wonder they are trying to be more independent from China now (the strict "gaming time" laws enacted there being yet another factor; I can respect the intent so kids aren't losing time studying & stuff, but that's the parent's job to do not government's).

They will be very aggressive in the coming year with the possibility of global recession that will hit the Japanese and Chinese economy especially hard. Some Japanese devs might be in trouble and Tencent might be able to grab a few a nice discount. Even some European devs will be pretty vulnerable. 2023 is going to be very interesting.

 

[thicc_girls_are_teh_best]

Sony’s investments in companies Tencent has put money into is a safety measure for Japan.

Due to Japanese law, there is a limit to foreign ownership of companies in key industries, including finance, tech and security. Sony is in both finance and tech, so Sony buying even 1% of a company Tencent has bought a stake in freezes Tencent out of buying any more stock, as they are no longer allowed to take a controlling interest in the company, making buying more stock than they have pointless for their investment model.

That's interesting to know that to be the case. I've heard of the protection laws and they make it a lot harder for foreign companies to buy into companies classified as parts of protected industries, and I'm assuming, makes it a lot harder for foreign companies to buy or invest into companies that are also partly invested into by a company falling under protected industries status.

Doesn't mean they can't be bought or invested into, just that it becomes a lot harder to do. And I'm guessing in many instances, makes the effort not worth it.

Why do ppl keep saying that? There isn’t a specific cap on forgone investment. The Saudi investment fund bought snk with no trouble. Any instituting can make itself open to forgiven investment unless it has some strategic sensitive significances. Netease and Tencent has stakes in Japanese devs. Sega has like nearly 29% of its stock forgone own and they took like 200mil from netease a few yrs ago. Tencent has 16% of from and almost the same in Kodakawa. Saudi investment fund has stakes in Nintendo and capcom. Ppl are always referencing laws and limits with out being specific.

I think prior to the Saudi group investment & purchase, SNK were already mostly a South Korean company, no? Or at least they were majority owned by a South Korean group (company, investor, firm I dunno), and South Korean probably has different laws with some of this stuff than Japan would.

It's true Netease & Tencent have stakes in Japanese devs/pubs, but most of them wouldn't fall under certain specific protections Kiryu mentioned Sony falls into, so I'm guessing investment opportunities for foreign entities into those types of Japanese devs/pubs are more liberal. I mean we saw Microsoft basically acquired Tango through Zenimax, so it's definitely true that non-Japanese companies can buy Japanese devs/pubs but I think that possibility (and/or the ease of it) depends on if those companies are also classified in any protected industry sectors.

Sega is a...weird scenario. It's always had American roots and was co-founded between an American (Hawaiian) and Japanese corporate merger. IIRC David Rosen did sell his shares maybe back in the late '90s or the '00s, and maybe that went to SoJ, but I think Sega's corporate structure is just a bit odd compared to other publishers. The Saudi group having an investment in NIntendo is rather interesting, given Nintendo's size and that on one had you would think they are a more protected corporation, but technically they don't fall under any protected industry sector classifications (which don't necessarily prevent foreign companies from buying or investing in Japanese ones, it just make it a lot harder because the process gets more technical) and I'm guessing the Saudi group have at most a very small minority stake in Nintendo.

I'm just recalling from memory though; don't really study these laws and such and in fact only started paying attention when these big acquisitions started taking more of a presence in the industry space (and TBF, a LOT of people only started paying attention to the legal side of things once the ABK acquisition in particular was announced and the drama started happening surrounding that).

They will be very aggressive in the coming year with the possibility of global recession that will hit the Japanese and Chinese economy especially hard. Some Japanese devs might be in trouble and Tencent might be able to grab a few a nice discount. Even some European devs will be pretty vulnerable. 2023 is going to be very interesting.

Yeah, Tencent are going to be an interesting one to watch. Losing that much value in just a year or two would understandably have them extremely worried (although it could be argued they were massively overvalued to begin with), and they would have an easier time expanding in Western tech markets through gaming than, say, social media, search engines, banking etc.

I wouldn't be surprised if they buy some shares into Ubisoft (if they haven't already); I think they're one of the publishers that was openly talking about being open to acquisitions or investments earlier in the year. Wouldn't be surprised if they put some investment into Asobo either; they are showing a lot of promise and Microsoft's hands are kind of tied right now over the ABK acquisition.

 

[KiryuRealty]

That's interesting to know that to be the case. I've heard of the protection laws and they make it a lot harder for foreign companies to buy into companies classified as parts of protected industries, and I'm assuming, makes it a lot harder for foreign companies to buy or invest into companies that are also partly invested into by a company falling under protected industries status.

Doesn't mean they can't be bought or invested into, just that it becomes a lot harder to do. And I'm guessing in many instances, makes the effort not worth it.

China is SPECIFICALLY banned from owning controlling interests in protected companies, due to security concerns.

 

[Bodycount611]

didn't tencent also pick up shares of FROMsoft? Seems they're unavoidable nowadays. anyone using this to boycott this game, enjoy boycotting the next souls game as well.

i'm playing Shift Up's mobile game a lot lately. it's actually pretty good, for a mobile game.

next year and the launch of stellar blade is pivotal for these guys. either they sink or swim.

 

[Gediminas]

didn't tencent also pick up shares of FROMsoft? Seems they're unavoidable nowadays. anyone using this to boycott this game, enjoy boycotting the next souls game as well.

i'm playing Shift Up's mobile game a lot lately. it's actually pretty good, for a mobile game.

next year and the launch of stellar blade is pivotal for these guys. either they sink or swim.

Yes, they bought even more shares than Sony.

 

[Gods&Monsters]

didn't tencent also pick up shares of FROMsoft? Seems they're unavoidable nowadays. anyone using this to boycott this game, enjoy boycotting the next souls game as well.

i'm playing Shift Up's mobile game a lot lately. it's actually pretty good, for a mobile game.

next year and the launch of stellar blade is pivotal for these guys. either they sink or swim.

I saw memes of that mobile game with the anime girls with big asses. I didn't know it was the same dev as Stellar Blade.

I'm not sure if Sony wants that IP

 

[Alabtrosmyster]

But other than to decide if they sell or not their stake to a potential future acquirer, they have no influence in the Shift Up big decisions or strategy.

At 20% ownership you get a seat at the table when it's time to make a decision, obviously when the founder keeps majority he has the last word.

 

[Yurinka]

At 20% ownership you get a seat at the table when it's time to make a decision, obviously when the founder keeps majority he has the last word.

For a giant corportation and specially western investors yes, they'd be in the board of directos. But this is a 'small' indie studio and the investor is Tencent/Chinese. At least for a handful western indie teams I know, where Tencent is the first or second stockholder with up to around almost half of the stocks, they don't ask to be in the table nor try to influence in any decision.

They give full support to whoever was there ruling the company when they invested. Basically Tencent researched their company project, team and long term plan and saw it promising so invested there, wished them good luck, told them that are open to help them in whatever they can if needed and told them that would be back in a couple of years to see how it's going (and as big investor collects dividends from the possible profits the company may make).

The typical western investor instead controls closer their investments, they frequently are asking for reports and progress, and often try to influence or even change the company strategical decisions.

I'm not sure if Sony wants that IP

Not sure about the IP, but I'd like to see them at least hiring the character designer and give him/her freedom. With no 'diversity' (censorship) team asking them to censor stuff.

 

[shrike0fth0rns]

didn't tencent also pick up shares of FROMsoft? Seems they're unavoidable nowadays. anyone using this to boycott this game, enjoy boycotting the next souls game as well.

i'm playing Shift Up's mobile game a lot lately. it's actually pretty good, for a mobile game.

next year and the launch of stellar blade is pivotal for these guys. either they sink or swim.

Yep.

didn't tencent also pick up shares of FROMsoft? Seems they're unavoidable nowadays. anyone using this to boycott this game, enjoy boycotting the next souls game as well.

i'm playing Shift Up's mobile game a lot lately. it's actually pretty good, for a mobile game.

next year and the launch of stellar blade is pivotal for these guys. either they sink or swim.

they also have 40% of epic, they have stakes in platinum, blue hole, activision, ubi, frontier, paradox, discord and several others. I can’t get away from Tencent.