The Case Study Of Tencent Holdings Limited Acquired Supercell Oy

Mobile games market which has grown with an explosive speed in recent years,M&A market in this industry is even more fervent and acquiring outstanding game studio has become an effective way for game enterprises to expand relative business and improve core competitiveness.But among numerous M&A cases,financial performance of target firm cannot meet expectation is a significant problem;another key point of consideration during acquisition is how to implement an effective integration so that synergistic effect can be maximum realized.Tencent Holdings Limited acquired Supercell Oy by forming a consortium this time,this way not only assisted Tencent to safeguard against risk of financial performance uncertainty of Supercell Oy,but also helped Tencent obtain sizable oversea games market shares rapidly and enhanced its innovative ability.This paper analyzes the case.First of all,the first chapter of this paper come up with study meaning from theoretical and realistic aspects through combining selection background with M&A relative literature.Meanwhile,introducing study methods,main contents,potential innovative points and shortcomings of this paper briefly.Secondly,this paper elaborate introduces both sides in the case and emphatically analyzes entire M&A scheme and how Tencent realized indirect hold Supercell Oy via building a consortium.After trimming the case I found that Tencent specially registered a subsidiary corporation before acquiring,then stripped subsidiary corporation and formed a consortium by bringing in co-investors and giving 50% voting right to them.Soon afterwards,Tencent purchased share of Supercell Oy through consortium and realized indirect holding eventually.Thirdly,the third and fourth chapter of this paper emphatically analyzes the reasons for acquiring and establishing consortium,conformity model,synergistic effect and existing problems.The reasons for acquiring include internal and external aspects,while there are three aspects for forming consortium.After acquisition,there are resource complementarity type of operating synergy which are enterprise advantage complementary and market scope complementary due to Tencent adopts discrete conformity model.Although the case is nearly perfect,continuing innovative ability of Supercell Oy influenced by employee turnover and long control chain may trigger hidden risks are still existing problems.In the end,on the basis of the analysis of this case,this paper summarizes worthy experience to popularize and proposes suggests for existing problems.After studying the case I found that acquiring outstanding game development company through forming a consortium then indirect hold the target firm,on the one hand,can help acquirer expand market shares and enhance innovative ability;on the other hand,it is an effective way to precaution against target firm's risk of financial performance uncertainty and acquirer can adopt separation model to implement M&A integration in order to achieve consolidation of both sides' resources quickly.For those enterprises which intent to conduct M&A in the future,it can use the experience of Tencent to carry out a successful acquisition.