In the realm of video game production, Tencent stands as one of the significant forces due to its ownership of Riot Games, the creators of League of Legends, and investments in other companies such as Epic Games. However, the corporation is currently grappling with substantial issues stemming from allegations of military affiliations with China.
As reported by Bloomberg, Tencent is among a group of firms identified as having links to China’s military by the U.S. Defense Department. This designation could carry significant consequences for Tencent and other companies on this list, as they have the opportunity to contest their classification. The potential fallout includes possible removal or delisting from U.S. stock exchanges and other global markets if the connection is confirmed.
During off-hours trading, Tencent experienced the initial effects of this news, causing a 7.3% drop in its share price to $49.31. If Tencent doesn’t manage to overturn this decision and gets delisted, the company could potentially face significant financial losses, but it’s uncertain how that might impact Riot Games. Recently, Tencent has been under scrutiny from the US government due to two individuals they appointed to Epic’s board of directors. The Justice Department stated that the Clayton Act prohibits members from one corporation holding positions on a rival company’s board. As a result, Riot Games’ Ben Feder and David Wallerstein stepped down from Epic’s board, and Tencent relinquished its ability to appoint further members to Epic.
Tencent holds a 16% share in Elden Ring’s developer From Software, and there are rumors that they are working on a mobile adaptation of this game. Moreover, Tencent owns a small portion of Assassin’s Creed’s publisher Ubisoft, but so far, there has been no agreement between the two companies regarding Ubisoft’s future ownership structure.
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2025-01-07 17:38