Yesterday (May 7), China Ruyi announced that Beijing Ruyi entered into an equity transfer agreement with Chaoxi Lightyear and Youyi Technology to conditionally acquire 100% of the sales equity of Beijing Youai Mutual Entertainment Technology Co., Ltd. at a consideration of RMB 259 million. The price is subject to adjustment, but in no event shall it exceed RMB350 million. After the completion of the equity transfer, Youai Technology will become an indirect wholly-owned subsidiary of China Ruyi.
In this regard, a number of relevant people told Grape Jun that the Youai assets acquired by China Ruyi only include its product "Red Alert OL" and a R&D team of less than 50 people. The announcement also mentioned that after the completion of the acquisition, Tencent will still serve as the exclusive agent of "Red Alert Online" in China, providing distribution, operation and promotion services.
01 Youai Entertainment: A variety of products are planned to be sold
Youai Mutual Entertainment was founded in 2011 and was wholly acquired by Chaoxi Lightyear in April 2021 and became its Youai Business Division. Before being acquired, Youai's core products included "I Want to Seal the Sky", "Red Alert OL", "Placement Girl" and so on.
At the beginning of 2022, Chaoxi Lightyear announced the establishment of a new R&D team "Youai Business Unit - Guangzhou R&D Center". In September last year, the DND-themed DRPG game "Dragonheir: Silent Gods" developed by Youai Guangyan was launched overseas. According to Sensor Tower statistics, one month after the game's launch, the revenue continued to grow in markets such as the United States, South Korea, and Hong Kong, Macao and Taiwan, ranking among the top 20 in terms of monthly revenue and the second in October. At the beginning of this year, the game has already received a domestic version number.
According to relevant sources, as of April this year, the cumulative revenue of the game has exceeded 500 million yuan.
In the same year, Youai Division also launched a new SLG product "Top Mech" overseas, which is similar to the gameplay of "Red Alert Online". However, the data page shows that the game was removed from the shelves at the end of that year.
Since the end of last year, after the business adjustment of Chaoxi Lightyear, Youai's products have also begun to seek new buyers.
According to relevant sources, the "Dragonheir: Silent Gods" product and team plan to be packaged with another simulation business project under development and sold for tens of millions of dollars.
In the process of this business adjustment, the two IP projects of Youai Division, "Tide Tower" and "Youmingzhi", were also exposed. They're all led by well-known game artists, and they're all in their early stages. Some people said that the two projects have found a place, but the news is not accurate for the time being.
Now that "Red Alert OL" has been revealed to be sold, only "Placing the Girl", the core product of Youai Mutual Entertainment is left, and there is no news about the sale. There is speculation among people close to the deal that the product may eventually be retained in the byte system.
The announcement issued by China Ruyi yesterday also disclosed that Youai Mutual Entertainment's after-tax profits in 2021 and 2022 will be 4.42 million yuan and 2.89 million yuan respectively. According to the financial statements of Youai Entertainment, as of December 31, 2023, the company's net asset value was approximately RMB343 million.
02 Chinese Confucianism: Enhance the understanding of the track and complement the R&D capabilities
China Ruyi, formerly known as HengTen Network, is a company closely related to Tencent, mainly engaged in investment, production and distribution of film and television, games and other businesses. According to the company's investigation, Tencent Holdings (the ultimate controller of Water Lily Investment Limited) is the second largest shareholder of the company, holding 21.97% of the shares.
The main products currently published by Ruyi's Jingxiu Games are the MMO "Ragnarok: Love Like First Sight", and the civilization IP SLG "World Qiyuan" developed by Tencent. The former was officially launched on March 26 this year, while the latter is still in the testing and appointment stage.
A person close to the deal said Ruyi had been looking to buy some of the assets since it announced it was selling the business. But in the end, because of the price and the value judgment of different projects, only the product "Red Alert Online" was chosen.
According to the source, Ruyi chose "Red Alert OL" for three reasons: first, the product's revenue and users are relatively stable and have passed the bottleneck period; Secondly, Ruyi has done some cooperation with SLG category products, and there are many similar products in the current pipeline, and "Red Alert OL" can increase their understanding of the track; In addition, Ruyi currently has a lot of IP reserves, and they hope to further supplement their R&D capabilities through this acquisition.