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BIZCHINA / Top Biz News
ZTgame secures investment?by venture capital
By Wang Xu (China Daily)
Updated: 2007-09-21 10:31
ZTgame, China's third-largest online-gaming company, has secured US$100
million from venture capitalists, taking it one step closer to offering
shares to overseas investors by the end of the year, sources said.
"Several venture capitalists and individual investors bought into this
company through private placements in August," said Bao Fan, chief
executive officer of China Renaissance. "ZTgame has filed its listing
application to US securities regulatory authorities and could hold the
share offering by the year's end."
Bao declined to reveal further details of the deal. His company, a
start-up investment bank, was ZTgame's fundraising advisor. Public
relations officials from ZTgame also declined to comment on the deal.
Shanghai-based ZTgame launched Zheng Tu, its first online game, last
April and quickly became the third-largest such company in the country,
behind Shanda and NetEase, both of which are listed on the NASDAQ.
The company raked in 779 million yuan (US$103.6 million)?in the first
half of the year, accounting for 14.9 percent of China's online gaming
market, according to Analysys International, a Beijing-based IT
consultancy.
"ZTgame needs the money to stay on a fast track," said Liu Xin, an
analyst with Analysys International. "It may acquire game development
teams or obtain game authorization from overseas gaming companies, as its
competitors did."
China's online gaming sector has been growing rapidly over the years,
spawning a swarm of local operators like Shanda and NetEase. These
companies started by operating games developed by overseas companies and
paying license fees. But in recent years, the Chinese companies have
stepped up efforts to build their own research and development
capacities, sometimes through acquisitions.
Shanda, the largest gaming operator in China, bought Aurora Technology
Development Co Ltd, a smaller counterpart in Southwest China's Sichuan
Province, this July. The company said later it had earmarked 2 billion
yuan for further acquisitions.
ZTgame is anticipating all of its revenue will come from Zheng Tu, which
once had more than 1 million players online at a peak time, according to
the company.
(For more biz stories, please visit Industry Updates)
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