Tencent’s $ 1.3 billion sumo deal in US security investigation
A US national security panel is investigating the takeover of Sumo Group by Tencent Holdings for $ 1.27 billion (roughly Rs. 9,518 crore), the British video game maker said on Friday, in a possible setback for the Chinese giant from the Internet.
Sumo, which has studios in the United States and four other countries, said Tencent has agreed to commit to obtaining approval from the Committee on Foreign Investments in the United States (CFIUS), which assesses the agreements for make sure they do not harm national security.
The secretive task force, which is also reviewing the US sale of the TikTok video-sharing app, had stepped up its review of the Chinese deals under former President Donald Trump.
Tencent struck a deal with Sumo in July, just days after China’s market regulator blocked plans to merge video game streaming sites, Huya and DouYu, on antitrust grounds.
Sumo and Tencent are working with CFIUS to obtain approval for the acquisition before the end of the year, the British firm said on Friday.
Sumo’s customers and partners, based in Sheffield, include Alphabet’s Microsoft, Apple and Google’s XBOX game studios, among others.
The deal would bring together Sumo’s running and snooker games with Tencent’s more prominent game line, which includes the mobile version of “Call of Duty.”
© Thomson Reuters 2021