Back in October, Mail.ru sold its MMO subsidiary MY.GAMES to Aleksander Chachava of venture capital firm LETA Capital, for $642 million. The company’s MMOs – Skyforge, Allods Online, Revelation Online, Warface, Conqueror’s Blade, and Armored Warfare – and even some of its top execs came along for the ride. But now it turns out that wasn’t the end of the companies’ efforts to split their holdings in the wake of the Russian invasion of Ukraine, as now MY.GAMES has issued a press release announcing that it will restructure its business out of Russia entirely.
“MY.GAMES, a leading international game developer and publisher, today announces a business restructuring and decision to exit the Russian market. As a result of the restructuring, the part of the business generating revenue in Russia will be spun off into a new independent entity with no affiliation to MY.GAMES, and MY.GAMES will cease all operations in Russia. MY.GAMES will focus solely on international business development, as well as improving infrastructure for its distributed team. Since 2020, more than 90% of MY.GAMES employees have been working remotely. In addition to its headquarters in Amsterdam, office in Cyprus, and representative offices in Korea, Spain, China, and Finland, MY.GAMES has also begun opening co-working spaces in the teams’ key regions of presence, including Turkey and Armenia. In 2023, the company intends to open several more co-working spaces in EMEA.”
MY.GAMES further says that it’s transferring Russian licenses to “independent Russian company” Astrum Entertainment and will “no longer earn revenue from these game titles on the Russian market.” If Astrum sounds familiar, it’s probably because of Astrum Nival aka Allods Team. VK Holding and Mail.Ru have controlled different iterations of the Astrum/Nival conglom for more than a decade now with multiple shared execs, and indeed, My.Games itself is a fairly new invention, spawned just a few years ago from Mail.ru’s My.com subsidiary, which also at one point swallowed up parts of Astrum. [We’ve updated below with clarification on the genealogy of these companies, as MY.GAMES says this new Astrum is unrelated to the old Astrums.]
All of which is to say that this whole situation looks a lot more like Mail.Ru divesting itself of non-Russian holdings while retaining Russian licenses, rather than My.Games autonomously surrendering Russian licenses after its sale as the press release implies. But however they’re going about it on paper, the result for the gaming industry is the same. [We’ve updated with clarification below.]
“Astrum Entertainment was named after the first major game holding company in Russia – Astrum Online Entertainment, which was founded in 2007, and ceased to exist in 2008 following a buyout from Mail.Ru. The new company, Astrum Entertainment, will operate fully independently from MY.GAMES, and has no connection to the defunct Astrum Online Entertainment (or Astrum/Nival) – MY.GAMES and Astrum Entertainment are two legally independent companies.”
Therefore, MY.GAMES hasn’t sold the licenses back to Mail.ru; the rep says Astrum is a new company that founded in part by… the new owner of MY.GAMES.
“Astrum Entertainment is not a Mail.ru subsidiary. In fact, it is not affiliated or connected with VK (formerly known as Mail.ru Group). Astrum Entertainment is a part of a joint venture between Alexander Chachava, Managing Partner of LETA Capital, and Innova Capital, whereby Innova is the controlling shareholder.”
The name Innova, of course, is well-known in the gaming industry; Daybreak’s EG7 just sold off Innova Group to divest itself of Russian holdings. But Innova Capital appears to be a Poland-based private equity firm. Can’t imagine why this would be confusing! So yes, it does appear that Chachava-owned MY.GAMES and Chachava’s new Astrum venture are “legally independent” from each other in that one doesn’t technically own the other, but they do share a rather key executive. We have updated our headline accordingly.