Numbers Game: China’s The9 Invests in Red 5 Studios

March 22, 2010 -

Chinese game developer and operator The9 Limited has entered into an agreement with U.S. online game developer Red 5 Studios that will see the former acquire a “majority interest” in the latter for approximately $20.0 million.

The9 previously operated World of Warcraft in China, before losing the WOW license to its Chinese rival NetEase. The9 still operates games such as FIFA Online 2 for Electronic Arts, in addition to its own games, such as World of Fighter and Atlantica. In its most recently reported quarter, The9 reported a 94.0 percent decrease in revenues to approximately $3.7 million U.S., versus the same period from a year earlier. It cited the loss of its WOW license, which expired on June 7, 2009, as the main reason for the drop.

Given that Red 5 is made up of former executives and game developers from WOW-creator Blizzard Entertainment, the deal seems to make a lot of sense, at least on paper. Red5, however, says that it “can’t tell you" what it's working on.

Zub Zhu, The9’s Chairman and CEO, said about the deal, “With the acquisition, The9’s global strategy is beginning to take shape. It will further enhance our game development capability and diversify our game portfolio and pipeline.”

Zhu will also take over as President when current President’s Xiaowei Chen term expires on May 16 of this year. Chen’s contract was not renewed.

The9’s market cap of approximately 176.0 million pales in comparison to its rivals like NetEase (5.18 billion), Shanda Interactive (2.78 billion) and Sohu.com (2.07 billion).


Comments

Re: Numbers Game: China’s The9 Invests in Red 5 Studios

The9 has a very small market cap compared to its rivals, but this can change quickly in this dynamic market. More and more Chinese companies are buying assets around the world, including Canada and USA.

John,

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Re: Numbers Game: China’s The9 Invests in Red 5 Studios

I bet Actiblizz is pissed about switching WOW operators- given the mess it stirred.  So much for saving a few dollars.

Also, I wonder if World of Fight will ever have a shot at a stateside release.

 
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Goth_SkunkAhh! I misinterpreted your statement about being left with almost every game in existence. I interpreted it as 'If you boycott games he's been involved with, you're boycotting almost all of them.'03/05/2015 - 9:31pm
Andrew EisenGoth - Card has been involved with only a small handful of games so if one were to boycott games for his involvement, they wouldn't be missing out on many games.03/05/2015 - 9:29pm
Goth_Skunk@Craig: Only if you're not interested in seeing it end.03/05/2015 - 9:27pm
Craig R.Instead of calling people the "anti gamergate faction", you could just call them "sane"03/05/2015 - 9:23pm
Goth_SkunkWhat do you mean 'almost every game in existence'? Card is a writer, not a game developer.03/05/2015 - 9:18pm
Andrew EisenBut I too wonder how many people who cry boycott actually follow through. I vaguely remember a few years ago a bunch of people boycotting one of the CoD games and were all found playing it on Steam.03/05/2015 - 7:53pm
Andrew EisenAn interesting quandary but not equivalent as boycotting games that Card was involved with leaves you with... well, almost every game in existence.03/05/2015 - 7:51pm
MechaTama31I agree that it's silly to avoid buying a game because one person involved with it said some things you disagree with. But I wonder how many of the people calling it silly this time have boycotted games for, say, Orson Scott Card's involvement?03/05/2015 - 7:40pm
PHX Corphttp://www.myfoxphilly.com/story/28274296/officer-injured Officer In Critical Condition Following Shooting Inside North Phila Game Stop03/05/2015 - 6:55pm
WonderkarpThe Shutup was a quick interjection saying "HEY! EVERYBODY SHUT UP AND LOOK AT THIS!" and I got the Critical Condition from a Local news site. I linked TMZ.03/05/2015 - 6:49pm
Andrew EisenThey call me The Jaws of Life.03/05/2015 - 6:48pm
Goth_SkunkThat's terrible. Now that it's been noted, can we return to Andrew's amazing steel-tearing teeth?03/05/2015 - 6:42pm
Andrew EisenWell, sucks that that happened and I'm glad he's alright (nothing in the article you linked says he's in critical condition) but there's no need for anyone to shut up.03/05/2015 - 6:41pm
WonderkarpEVERYBODY SHUT UP! Harrison Ford is in Critical Condition After A Plane Crash!! D: http://www.tmz.com/2015/03/05/harrison-ford-plane-crash-landing-golf-course-santa-monica/03/05/2015 - 6:38pm
Goth_SkunkIt ruined my joke about your billionaire lifestyle affording you state-of-the-art dentistry. I longed to see you fill your mouth with steel-tearing jaws.03/05/2015 - 6:32pm
Andrew EisenYep, typos happen. Even on the invoices I send for my freelance work. Yeah, that's always super embarrassing.03/05/2015 - 6:29pm
Goth_Skunk"Steel" your fr- aww crap you fixed it.03/05/2015 - 6:26pm
Andrew EisenReally? Whatever I say? Okay... I'm a handsome, impressively endowed, billionaire genius with a complete set of He-Man action figures and everyone wants to steal my Fruit Loops!03/05/2015 - 6:18pm
PHX Corp@AE I'm still buying Codename S.T.E.A.M. and the New Nintendo 3DS probaly as soon as said game Launches03/05/2015 - 6:16pm
Goth_SkunkWhatever you say.03/05/2015 - 6:15pm
 

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