In a significant development, ByteDance, the company behind the popular social media platform TikTok, is reportedly engaged in discussions to sell its gaming assets to Tencent (OTC:TCEHY).
What Happened: ByteDance is in conversation with potential buyers for its gaming assets, Reuters reported on Tuesday. Tencent, the world’s largest video game company, is among the leading prospects. However, no agreement has been finalized yet, a ByteDance representative confirmed it to Benzinga.
“We can confirm on background that Nuverse is indeed in talks with multiple prospective buyers, including Tencent, but we have reached no deals with Tencent so far. Otherwise, we have no more information to provide,” the spokesperson said.
The talks include ByteDance’s gaming unit, Nuverse, and its popular games “Crystal of Atland” and “Earth: Revival”, as per a report by the local media outlet, LatePost.
This development comes after ByteDance announced in November its intentions to revamp Nuverse and withdraw from the gaming business, after five years of being in the $185 billion global video games market. The company ceased further development of unreleased games and planned to sell off already launched titles.
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ByteDance is also looking to sell its other gaming unit, Moonton, which it acquired in 2021. Despite a period of intense competition, ByteDance’s relationship with Tencent in gaming appears to be improving. In December, Tencent utilized ByteDance’s advertising network to promote its latest game, “DreamStar.”
Why It Matters: This move follows a series of significant shifts within ByteDance. In April last year, the company made a substantial commitment to its upcoming IPO in Hong Kong by leasing a large space at the International Finance Centre (IFC). However, its valuation faced uncertainty due to the challenges faced by its TikTok arm.
Furthermore, in December 2023, the company decided to restructure its gaming business and focus on other long-term strategic growth areas, significantly downsizing its Nuverse gaming brand.
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