French video game developer Dontnod announced it has received 30 million euros (US$36.3 million) from Chinese internet giant Tencent in exchange for a minority stake in the company.
The investment is part of a 40 million euro (US$48.4 million) capital increase through an accelerated book-building process, according to a statement. The new shares will trade on the Euronext Growth market in Paris.
As part of the deal, Tencent would have the option of proposing the appointment of a representative on Dontnod’s board.
A still from Dontnod’s Life is Strange / Image credit: Dontnod
Founded in 2008, Dontnod is the independent gaming firm behind titles such as Vampyr, Twin Mirror, and the Life is Strange franchise. The company has worked with partners such as Microsoft, Square Enix, Bandai Namco, and Capcom.
It plans to use the new funds to develop new self-published titles worldwide on PC, console, and mobile platforms.
“Through this partnership, Dontnod is perfectly positioned to take advantage of the various growth drivers in the video game industry, particularly in China and on mobile platforms, in cooperation with an industry leader,” said the gaming firm’s chairman and CEO Oskar Guilbert.
The move comes as Tencent’s share price rallies to be within reach of a US$1 trillion market capitalization. The surge has recently subsided, but Tencent’s stock is still roughly up by 24% as of yesterday from its closing numbers at the end of 2020.
See Also: Alibaba and Tencent’s growing tentacles in Southeast Asia
Analysts at financial services major Citi also expect Tencent’s annual earnings to jump 34% this year to US$25.4 billion, with the company expanding its global market presence in the video gaming space, a previous Reuters report noted.
Editing by Collin Furtado and September Grace Mahino
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