Tech giant Tencent is reportedly in talks to exit several of its gaming industry investments. According to Bloomberg, citing anonymous sources familiar with the matter, the company is currently reviewing its minority stakes in numerous game development studios.
The potential exits include investments in the Japanese market, particularly publicly traded company Marvelous Inc., whose shares are listed on the Tokyo Stock Exchange. According to the report, Tencent is prepared to offer buyouts to the original management teams of these studios, even if doing so would force the company to record financial losses on the deals.
The strategic shift is linked to an update in Tencent's internal investment policy. Going forward, the company intends to focus on games featuring user-generated content and projects built around architectures that support regular and continuous content updates.
An additional trigger for the portfolio reassessment may have been the major investment failure of Highguard earlier this year, a project in which the Chinese conglomerate acted as a key sponsor. The game launched on January 26 and immediately received mostly negative reviews on Steam. Despite attempts to improve the situation through updates, the developers announced layoffs as early as February 11, and the game was completely shut down just two months after release.
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