Tencent to Acquire Gaming Smartphone Manufacturer Black Shark, Advancing Metaverse Plans
36Kr was informed on Monday that Tencent plans to acquire Black Shark, a gaming smartphone company. After the acquisition, Black Shark will be merged into PCG of Tencent Group led by Ren Yuxin. Tencent declined to comment on this acquisition.
Once the transaction is completed, the hardware manufacturer will undergo its own business transformation. The future business focus of Black Shark will reportedly expand from gaming smartphones to VR devices as a whole – Tencent will provide content and Black Shark will provide hardware portals.
Black Shark was established in 2017 with capital injection from Xiaomi. Chinese commercial enquiry platform Tianyancha shows that Tianjin Venture Capital Industrial Co., Ltd., which is wholly owned by Xiaomi, is the major shareholder, with 46.4% equity of Black Shark. Luo Yuzhou, cofounder and current CEO of Black Shark, used to be the Vice President of Huawei’s Consumer Business in China. It’s said that the acquisition has also been recognized by Xiaomi‘s top executives.
“Black Shark is valued at 3 billion yuan ($470.78 million), and Tencent has cut it to about 2.6-2.7 billion yuan ($408.01-423.7 million),” a source said.
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Considering other recent moves by major players in the industry like Facebook and ByteDance, Tencent‘s advancement into the field of VR and AR was simply a matter of time. In July 2014, Facebook (now named Meta) acquired Oculus for $2 billion, and the current shipment has exceeded 10 million units. In August 2021, ByteDance acquired Pico at a price of 9 billion yuan ($1.41 billion).
Tencent obviously wants to grasp this opportunity. After releasing the firm’s Q3 financial report last year, founder Pony Ma emphasized in the performance conference call that Tencent has a lot of technologies and abilities to explore and develop the metaverse, which is reflected in the trademarks it has acquired. Previously, Tencent has registered trademarks such as “King Metaverse,” “Tianmei Metaverse” and “QQ Metaverse.”