Tencent Holdings acquires majority stake in video game developer Riot Games

Tencent Holdings Ltd, China's leading provider of internet and mobile and value-added telecommunications services, yesterday acquired a majority stake in video game developer Riot Games, for an undisclosed sum.

Los Angeles, California-based Riot Games is a video game developer and publisher of premium, competitive online games. The company was established in 2006 and has quickly become a leading global developer and publisher of premium free-to-play online video games having launched their debut title League of Legends, in October 2009.

To date, more than one million gamers play League of Legends and log more than half a billion minutes of playtime each month.

Tencent was an investor in Riot Games during its previous rounds of financing. Other prior investors included Benchmark Capital and Firstmark Capital.

Post closing, Riot Games will retain its independent operations and its existing management team will continue to run the company. With Tencent's financial backing, Riot Games said that it will enhance its flagship title ''League of Legends," expand into new markets and develop new games.

Guangdong-based Tencent,  one of the largest web portals in China has three main streams of revenues - internet value-added services, mobile and value-added telecommunications services, and online advertising.

Tencent runs various online platforms, including Instant Messaging QQ, web portal QQ.com, QQ Game portal, multi-media social networking service Qzone and wireless portal.

In April last year, Tencent invested $300 million in Moscow-based Internet-investment group, Digital Sky Technologies (See: China's Tencent gains backdoor stakes in Facebook, Zinga via $300-million DST investment), majority owned by Russian billionaire Alisher Usmanov, and acquired Comsenz, a Google-backed social-networking firm for more than $60 million in August 2010 (See: China's Tencent buys Google-backed social-networking firm Comsenz)