RuneScape studio Jagex has been sold, again, this time valued at $530M

    
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A weapon!

Back at the beginning of 2019, we covered the news that RuneScape developer Jagex was being put up for sale by the Chinese holding company that purchased it back in 2016. The reason, as we noted then, wasn’t that the UK-based Jagex had performed poorly; it was that Shanghai Fukong struggled in 2018 because of the flagging Chinese communication sector and gaming freeze in the region, leading to reduced revenue, falling stocks, and even the resignation of the company chairman in December. In fact, Jagex spilled a lot of ink reassuring everyone that Jagex and RuneScape itself would be fine.

We’re still hoping that’s the case, but at least Jagex will avoid Fukong’s fate. At the end of June, Fukong announced that it would be selling Jagex to “US Platinum Fortune,” valuing it at $530M US ($230M more than it paid back in 2016). This is likely a mangled translation of Platinum Equity, which as Redditors point out is a California-based private equity investment firm. According to Chinese publication Yicai Global, Jagex generated 99.5% of Fukong’s revenue last year, but the Chinese company has been mired in 57 (!) “litigation and arbitration” cases relating to “financial and credit disputes.” Yikes.

Update
Jagex has issued a soft denial of the sale, suggesting the final decision hasn’t yet been made.
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Poker Brat
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Poker Brat

The company I work for was just bought by Platinum Equity last week. The way these Equity companies work is they buy a company , build it up, and then sell in a few years. Same will happen with the company I work for, and in a few years Jagex will be for sale too.

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Randy Savage

Yep it’s what they call “good business”. Buy cheap, optimize things a bit, and then sell shortly thereafter for a profit. And thereby avoiding any of the risks of a long term investment.

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Greaterdivinity

I love finding out the odd, never-heard of billion/trillion dollar companies that actually own and operate a surprising number of major companies in the world.

WHO WOULD EVER KNOW THAT SUMPO FOOD HOLDINGS IS ACTUALLY A MAJOR PLAYER IN THE MMO SPACE?! Because they are, they largely own Digital Extremes and Perfect World (who own Cryptic), and ain’t nobody ever heard of Sumpo Food Holdings.

Good lord though, 99.5% of their revenue last year and they sold it? Seems like some folks are looking to cash out before the bottom falls out of the company via lawsuits…

Mewmew
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Mewmew

Sell it, take the money and run before all your assets are taken from you.

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Randy Savage

It’s rarely ever that nefarious in the corporate world. These sorts of decisions are usually based on data obtained from listless number crunchers staring at spreadsheets.

I always find it funny how much outsiders assume there’s a human element involved with these sorts of decisions. From my extensive experience with large corporations, it’s actually the lack of humanity that is the problem. There is no sinister plot. It’s just numbers on a screen, and that unto itself is a problem.

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Bruno Brito

I rarely agree with you, but this sounds like one of the instances i do.

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Connor

“before the bottom falls out of the company via lawsuits…”

Fukong is selling Jagex to gather a lump sum to pay off massive legal debts of its own (not related to Jagex).

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silverlock

I don’t know it sounds like the Pan Am syndrome to me.

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Mikka Hansen

Whenever I hear about this unknown holdings splurging on game companies with f2p/microtransaction business models, I always think the same:

Money laundering