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iDreamSky Shells Out $10M For Silicon Valley Game Startup Rumble
iDreamSky, the company known for localizing popular western apps including Fruit Ninja and Temple Run, has paid $10 million USD for a majority stake in Silicon Valley-based game startup Rumble, according to the Chinese company. It’s the most significant foreign investment they’ve made since announcing plans to privatize their Nasdaq-listed company.
The partnership will allow iDreamSky to publish Rumble’s highly popular KingsRoad game on the mainland. Rumble focusses on higher quality mobile games, but has struggled to compete with big names in the market including Clash of the Clans, which already has a significant following in China.
iDreamSky has had a series of hit-and-miss game localization attempts, but has tapped into a vein of high profile apps to drive their growth. Earlier this year they announced they would be modifying the highly rated Temple Run 2 game with an added Bruce Lee character exclusively for Chinese audiences.
While online and mobile gaming is a rapid growth industry in China, the market is seeing some saturation and even large players are reporting lower revenues. Industry giant Tencent revealed that game growth had significantly slowed in their Q2 results this year, dropping from 28% to 17% in the preceding three months.
iDreamSky is one of many Chinese tech companies looking to privatize and re-list locally, as confidence in Chinese tech stocks continues to grow despite volatility in the past six months. After listing in August last year, the company announced just ten months later that they would be considering a privatization proposal led by CEO Michael Xiangyu Chen. Other Chinese companies with gaming who have considered privatization include Qihoo 360, Renren, Snda Games and Perfect Sky.
According to their most recent earnings report the company has 118 million monthly active users and saw a 113.6% jump in revenue growth since last year. Their share price dipped to $7.00 USD in April, less than half their original listing value, but has since rallied to a healthier $12.50 USD per share.
Image Credit: Rumble [KingsRoad]