Key facts
- Alibaba Group is selling its game developer unit, Lingxi Games, to Trustar Capital.
Alibaba Group is set to sell its game developer unit, Lingxi Games, to private equity firm Trustar Capital for more than $2 billion. The deal follows several rounds of talks and an internal memo confirming the agreement. Lingxi's CEO will continue to lead the company post-acquisition.
The sale of Lingxi Games for over $2 billion highlights Alibaba's strategic pivot towards AI and cloud, signaling a significant divestment from its gaming interests. It also underscores Trustar Capital's investment in the gaming sector and potentially reflects ongoing consolidation and regulatory shifts within China's tech and gaming industries.
Alibaba Group is poised to sell its game developer subsidiary, Lingxi Games, to private equity firm Trustar Capital for over $2 billion, according to sources familiar with the matter. The deal, confirmed through an internal memo to Lingxi staff, signifies Alibaba's strategic shift to focus on core priorities like artificial intelligence and cloud computing, while divesting non-core assets.
Lingxi Games, known for its popular title 'Three Kingdoms: Strategy Edition' developed in collaboration with Japan's Koei Tecmo Holdings, will continue its operations under the leadership of its current CEO, Zhou Bingshu, and his management team. This continuity is intended to ensure a smooth transition following the ownership change.
Trustar Capital, formerly known as CITIC Capital, is an Asia-focused private equity firm that reportedly possesses the industry resources and operational expertise to foster Lingxi's future development. The sale follows a period of transition for Lingxi, which had previously explored external fundraising efforts that were stalled by proposed regulatory tightening in China's online gaming sector. Lingxi also experienced a management reshuffle earlier in 2024.
Alibaba, a major Chinese technology conglomerate, has been actively reviewing its portfolio of non-core assets as it reallocates capital and management focus towards strategic growth areas, particularly AI and cloud services. The sale of Lingxi Games is part of this broader corporate restructuring.