Remember a couple of years back when RuneScape company Jagex was bought out by China’s Shandong Hongda, a company known primarily for its iron ore mining operations, to the tune of $300 million? Then the companies performed some corporate magic to create Zhongji Holding, which was set to oversee the games branch of the corporation. (It later changed its name to Shanghai Fukong.)
And then… everybody spent the last few years shuffling execs and seemingly making a ton of money as RuneScape and its spinoffs continued to increase in popularity. Jagex was even working on at least one more MMO.
That’s why it might seem initially puzzling that this week Reuters published a brief announcement that Shanghai Fukong is hoping to sell its “entire or partial stake” in the UK-based Jagex Ltd. But it looks as though while Jagex was making bank and generating its best year ever in 2018, Shanghai Fukong was down on its luck. Not only was the Chinese games market stifled last year by the government bureaucracy’s freeze on approving new games, but the communication sector in the country is down, and Shanghai Fukong performed poorly against it, leading the venture capitalist firm to poor annual revenues and plunging stocks.
Yahoo also reports that Shanghai Fukong’s chairman resigned for “personal reasons” less than a month ago.
In other words, if you’ve got any cash left over after buying Nexon, maybe spare a bit for Jagex.