Chinese state-owned investment firms AVIC Capital and CITIC Capital have joined other private equity investors to commit US$850 million toward Tencent Holdings Ltd’s acquisition of Finnish game developer Supercell.
China’s CITIC Bank Corp and Chinese bad debt manager China Cinda Asset Management also joined the consortium formed by Tencent for the purpose of the deal.
Tencent, China’s biggest gaming group, agreed in June to buy 84% of the "Clash of the Clans" mobile game maker from Japan’s Softbank Group Corp for around US$8.6 billion.
Tencent had disclosed at that time it planned to introduce co-investors for the purchase, but would maintain a 50% voting interest in Supercell.
The consortium will purchase an initial 73.2% stake in Supercell first, and plans to gather the rest from Supercell employees.
Once the acquisition is completed, which is expected during the third calendar quarter of 2016, the consortium will indirectly hold 76.9% of Supercell.
The deal is mostly financed with bank loans. Tencent has received commitments of over US$1.8 billion from 12 to 13 banks for a US$3.5 billion loan to fund the acquisition, according to media reports.