Select Page

impending sale of Supercell were reported by ExitHub last month. SoftBank first acquired a 51% stake in Supercell for $1.5 billion in October 2013. Supercell had previously raised $12 million in a Series A funding round led by Accel Partners in 2011, and $130 million in a Series B round led by Index Venures and Institutional Venture Partners (IVP) in April 2013. Following the transaction, Supercell will be owned by the Tencent consortium and by Supercell’s employees who will take part in a new long-term incentive plan, and will be able to sell their vested shares annually to Tencent. Supercell will retain its independent operations, the headquarters will remain in Helsinki, Finland and its existing team will continue to run all of the company’s operations. The deal is expected to close during the third calendar quarter of 2016, subject to customary regulatory approvals and closing conditions. Following the closing, Tencent expects to maintain a voting interest of 50% in its investment consortium. Tencent said it “will not consolidate or equity-account for its investment in the consortium,” adding that “this structure will give existing Supercell management maximum independence in order to incentivize and drive future performance, while enabling Supercell to access all of Tencent’s expertise and user base.” In parallel to the transaction, Tencent and Supercell have entered into marketing and publishing arrangements regarding the distribution of games developed by Supercell in China. “Tencent represents the ideal partner to take Supercell’s business to the next level. Our decision to divest our shares is driven by our continued focus on monetization for the benefit of our shareholders and on capital structure discipline, both key pillars of our SoftBank 2.0 strategy,” said SoftBank’s chairman and CEO Masayoshi Son, the second richest person in Japan. Supercell CEO Ilkka Paananen noted that “this new partnership offers us exciting growth opportunities in China, where we will be able to reach hundreds of millions of new gamers via Tencent’s channels.” “We are excited that Supercell is joining our global network of game partners, and will preserve their independence and enhance their advantages, thus bringing even more exciting gaming experiences to players around the world,” said Tencent president Martin Lau. “It is important to us that Supercell stays true to its roots by sustaining its unique culture, continuing to be headquartered in Finland, and representing its home proudly.” Morgan Stanley & Co. International plc served as financial advisor and Fenwick & West LLP and White & Case LLP as legal advisors to Supercell. The Raine Group LLC served as financial advisor and Morrison & Foerster LLP and Hannes Snellman as legal advisors to SoftBank. BofA Merrill Lynch served as financial advisor and Covington & Burling LLP and Slaughter and May as legal advisors to Tencent. Tencent was founded in Shenzhen in 1998 and went public on the Main Board of the Hong Kong Stock Exchange in 2004. The company is one of the constituent stocks of the Hang Seng Index. Tencent’s diversified services include QQ, Weixin, WeChat, Qzone and Tencent, serving hundreds of millions of Internet users through its integrated communications, social networking, online gaming, news and video platforms. SoftBank Group Corp. is a Japanese multinational telecommunications and Internet corporation, with operations in broadband, fixed-line telecommunications, e-commerce, Internet, technology services, finance, media and marketing, and other businesses. The company was founded in 1981 and is headquartered in Tokyo, Japan. In May 2015, SoftBank was ranked in the Forbes Global 2000 list as the 62nd largest public company in the world. Between 2009 and 2014, SoftBank’s market capitalization increased by 557%, the fourth largest relative increase in the world over that period. At the beginning of 2015, the company was the third largest public company in Japan after Toyota and Mitsubishi UFJ Financial. As of May 13, 2016, SoftBank had a market capitalization of US$61.57 billion.]]>