Chinese Gaming Company Ourplam to Buy a Stake in US Game Engine Developer Unity

Chinese gaming company Ourpalm (SZ:300315) announced last night (Beijing Time) to invest in Unity Software Inc., the San Francisco, US – based developer of game engines and development tools. The statement says the amount of funding will be big.

One of Unity’s shareholders is looking to sell his shares, according to a report by VentureBeat. The company is valued at over US$1 billion to US$2 billion. Last year Amazon offered US$650 million for Unity but the CEO decided not to sell, according to the report.

Unity entered China in 2012. China now is the largest market for Unity in terms of the number of registered developers and developer activeness. The number of Chinese registered developers surpassed that in the U.S. to become the No.1 in April 2014, as reported by 199IT. The company claims 75% of the top-grossing 3D mobile games in China are developed with Unity, citing research results from Source DNA.

Unity’s competitors include the Unreal Engine of Epic Games, in which China’s gaming giant Tencent has a minor stake.

In China the well-known local game engine brand is Cocos2d-x, owned by Chinese gaming company Chukong. Chen Haozhi, CEO of Chukong, disclosed in May this year that Amazon offered to buy Cocos2d-x for US$600 million last year. Chukong suspended planned IPO earlier this year, for the company thought they were undervalued and the game engines alone should be worth hundreds of millions of dollars.

Founded in 2004 in Beijing, China, Ourpalm develops web games (or browser games) and mobile games, and publishes third-party games. The company went public in May 2012 on the Growth Enterprise Market of the Shenzhen Stock Exchange. Since 2013 Ourpalm has acquired and invested in several Chinese game developers that include Dovo, Playcrab and Shanggame. Unity will be the first foreign company Ourpalm invests in if the investment is successful.