chinadotcom Subsidiary Completes Investment In 17game

By TechSecurityChina.com Editor
March 03, 2004

chinadotcom corporation, an integrated enterprise software and mobile applications company in China and internationally, today announced that a subsidiary of its mobile and portal unit, hongkong.com Corporation completed its strategic investment in a Beijing-based online games company, Beijing 17game Network Technology Co. Ltd (17game).

John Xiao, CEO of hongkong.com said, “As online game revenues in China are expected to reach US$1.5 billion annually by 2008, 17game provides a roll-out platform for our expansion in the high growth online games sector in China. In addition, leveraging the existing vertical online game channel of our portal and our strong distribution network with the mobile operators, particularly at the provincial level, the strategic investment in 17game should enable us to expand our online gaming business using our scalable platform.”

17game has a track record in launching and distributing successful online games in the China market. Currently, 17game operates an online game which is considered by an IT magazine in PRC to be one of the top 10 online games in the China market and is expected to launch a new online game, Yulgang, this year. It also plans to add another online game to its portfolio that was ranked within the top five online games by a Korean online game magazine in the Korean online games market, in terms of total aggregate play-time, among all commercialized online games and online games in testing phases. 17game has a well-established distribution network across China for the games it licenses, including Internet cafes, software distributors, bookstores and department stores.

The contemplated transaction is expected to enable hongkong.com to ultimately acquire a controlling position in 17game over time with consideration to be paid on an earn-out formula based on a single digit earnings multiple over the next two years.

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