Wang Sicong and Ren Quan participated in the privatization of Le Dou Games and established a 1 billion industrial fund or will be listed on a backdoor basis

Dream World, the parent company of Ledan Games, officially announced on May 16 that at the shareholders 'meeting held on Monday, the company's shareholders had approved the previously reached privatization agreement. Chen Xiangyu, CEO of Ledao Games, said that we must not only introduce high-quality overseas content to China, but also introduce domestic excellent cultural and creative products to global users.

It is understood that at this shareholders 'meeting, shareholders accounting for 71.8% of all issued common shares of the company voted on the privatization agreement, and the final proportion of votes in favor was 99.99%. After the transaction is completed, Dream World will become a privately held company and delist from Nasdaq.

In fact, as early as December 31, 2015, Dream World, the parent company of Le Dou Games, issued an announcement announcing that a final privatization agreement had been reached.

According to the privatization agreement, the parent company purchased all issued Dream World that it did not yet hold with cash of US$3.50 per Class A and B common share (equivalent to US$14 in American Depositary Shares, approximately RMB 91). ordinary shares.

The investors in the privatization agreement are mainly Chairman and CEO Chen Xiangyu and CTO Guan Song, as well as holders of certain deferred securities. The new investors include Wanzhang Capital, an investment platform of Vanke Group, Junlian Capital, a subsidiary of Legend Holdings, We Capital, Puri Investment founded by Wang Sicong and Star VC founded by Ren Quan. It is reported that LeDou Games may be listed on a backdoor basis after being privatized.

On January 26, 2016, Le Dou Games also changed its CFO. Le Dou Games said at the time that CFO Zou Jun had resigned due to personal reasons. After leaving the company, Zou Jun will continue to serve as a consultant to the company, and Lei Junwen, the company's vice president, will replace Zou Jun as the new CFO. As a publisher in the domestic mobile game field, Le Dou Games is known for its agent operation of Halfbrick's famous game "Fruit Ninja" and the agent release of "Temple Escape". It has also operated and agent "Angry Birds".

According to public information, Le Dou Games received 8 million yuan in investment from Lenovo Star Angel at the end of 2010, and received a total of 10 million US dollars from Red Dot Investment and Junlian Capital at the end of 2011. It also received financing twice in 2013. Among them, LC Fund invested millions of dollars in Leduan Games several times in 2013, while Tencent's THL A19 Limited invested a total of US$15 million in October 2013. In 2014, Leju Games was successfully listed on NASDAQ.

Chen Xiangyu, CEO of Le Dou Games: The return was not to pursue a higher P/E ratio

. It took nearly a year to revitalize Dream World. The privatization of Dream World was finally approved by the shareholders 'meeting. However, the atmosphere in the A-share market is no longer what it used to be. There is even news that a company has terminated its privatization.

The market's enthusiasm for the return of Chinese stocks turned from being enthusiastic at the time to questioning, and criticisms such as "arbitrage behavior under huge differences in valuation" were also heard endlessly.

A series of bad news caused China Stock Exchange to fall continuously, and there was even news that many companies had terminated their privatization. Why does DreamWorld insist on privatization? Where will DreamWorld go now when the privatization has been settled?

Chen Xiangyu, CEO of Dreamworld, said in a recent connection with reporters that capital planning is one of the company's long-term strategies and is also indispensable for sustainable business development. Dreamworld will steadily advance its capital strategy under the guidance of national policies and regulations.

"We are very happy to see the domestic capital market becoming increasingly mature: regulators have implemented more scientific management at the national strategic level, investors have become more and more able to judge high-quality listed companies, and a multi-level capital market is gradually being built." Analysts believe that domestic regulators prefer the return of high-quality Chinese stock companies, such as 360 and Leduan Games, which have relatively strong sustained profitability. Chen Xiangyu believes that everything about domestic regulatory policies is to create a good environment for listed companies to continue to develop.

So, after the privatization of DreamWorld, whether to backdoor listing or adopt other methods to connect with the domestic capital market, Chen Xiangyu told reporters that DreamWorld is open to diversified capital operation ideas.

The return is a trend

that has been established as an industrial fund Investment Microfilm. As the largest mobile game distribution platform in China, the brand awareness of LeDou Games is not as good as its products. Fruit Ninja, Temple Escape, Subway Parkour, Monument Valley, etc., these "national-level mobile game" products have all been introduced to China by Leduan Games and are operated locally.

In Analysys International's 2015 China Mobile Games TOP 100 rankings, LeDou Games has once again secured the top spot in China mobile game distribution market. According to Analysys's report, Ledan's market share reaches 28.3%, leading other manufacturers.

According to one data, the cumulative number of users of Leduan Games has reached 1.3 billion, and the monthly users have reached 130 million. What makes Leduan Games more depressed is that "one in five China people has cut fruit, but he probably doesn't know that Leduan Games is behind it." This is also one of the original intentions of privatizing Leju Games. Chen Xiangyu told reporters that returning to A-shares will be more conducive to China users understanding Ledui Games and greatly enhance the brand value of Ledui Games.

In the U.S. capital market, Chen Xiangyu has a regret. In the past year since Dream World was listed on NASDAQ, during the process of communicating with investors, Chen Xiangyu found that the U.S. capital market has limited understanding of China's game market and pan-entertainment market.

This makes it difficult for Dreamworld to use the capital market to develop new businesses. In contrast, the cultural industry is an industry that China vigorously develops. The country's 13th Five-Year Plan clearly states that the cultural industry has become a pillar industry of the national economy.

"From 2015 to the present, we have seen signals of the upgrading of cultural consumption in China and the taking off of cultural industry through a series of support and incentive measures by the State Sports General Administration and other departments." Chen Xiangyu said that the cross-border integration of the Internet with the cultural and entertainment industries is leading the way in domestic consumption upgrades. New cultural consumption hotspots and new models such as secondary economy, e-sports, and VR are emerging one after another, creating huge development space for mobile game companies.

"Based on the core business of mobile game publishing, Leju Games will continue to carry out cross-platform and cross-domain explorations and attempts to meet the public needs after the upgrade of cultural consumption." Chen Xiangyu said that returning to A shares is more conducive to the company's business expansion and investment in mergers and acquisitions.

According to the reporter's understanding, Dream World has just established a 1 billion yuan industrial fund to invest in the pan-entertainment and cultural industry chain. Currently, it has invested in leading industry companies such as Wanda Pictures and Microfilm. Wanda Cinema Line is ready to include Wanda Pictures in A shares.

The return is not for the price-to-earnings ratio. Investors are all strategic shareholders

. According to the previous announcement issued by Dreamworld, in addition to CEO Chen Xiangyu and CTO Guan Song, the main investors in its privatization are also institutional investors such as Tencent, Junlian Capital, and Wang Sicong's Puri Investment., all three institutions are strategic investors in Dreamworld.

"We choose strategic investors and long-term funds." Chen Xiangyu said that for example, newly entered investment institutions Star VC and Microfilm are highly complementary to Leduan Games in terms of film, television and IP.

As the only publisher of mobile games that Tencent has invested in China, Ledao has received strong support from Tencent in this privatization.

According to public information, in August 2015, Tencent's shareholding was 20.12%. After privatization took effect, Tencent's shareholding increased to 26.26%. At the same time, Dream World's management is also increasing its holdings. The above information has not been officially confirmed by Leduan Games.

However, according to Chen Xiangyu, since Ledao Games was listed in the United States, the management has never sold the company's shares. "The company is still in a period of rapid development and has strong sustainable profitability. Everyone values the benefits of long-term returns more." Data shows that Dream World was established in 2011 and successfully landed on NASDAQ in the United States on August 7, 2014. It only took three years and six months to become the fastest listed company; Dream World's revenue in 2012 was 19.37 million yuan. In 2015, Dream World still ranked first among the "Deloitte Shenzhen Top 20 High-Tech Growth". Dream World predicts that the company's revenue in 2016 will exceed 2 billion yuan.

"We very much want to share our growth with domestic players and investors." Chen Xiangyu said that after the baptism of the U.S. capital market, the company's operation has become more mature, standardized and transparent, and the management has a deeper understanding of the responsibilities and obligations of listed companies so as to be better responsible to shareholders and investors.

Game companies were once favored in A shares, with an average price-earnings ratio of 90 times. After many market adjustments, many of them have dropped to more than 50 times, and some even dropped to more than 30 times. So, is it appropriate for Le Dou to choose to return at this time?

In this regard, Chen Xiangyu made it clear to reporters: "We are not returning for a high P/E ratio. Sooner or later, the market will make rational adjustments. The product business is the last word." It is not that we must stick to the China market but also counterattack the international market and leave the U.S. capital market. It does not mean that Le Dui Games will stick to the China market.

In fact, this China company, which made its fortune by publishing overseas high-quality games, has begun to reverse internationalization after years of silent accumulation in cooperation with many major international companies. In August 2015, Leju Games acquired American game developer Rumble. Two months later, Leduan Games announced that it would launch China's domestic mobile games "HND Heroes Forever" and "Mr. Pumpkin's Adventure" to the North American market. These two games have won the Apple App Store. Thousands of recommendations from more than 200 countries and regions.

Ledao Games has established the China Independent Game Support Alliance with Hammer Technology and other companies. In March 2016, the internationalization of Leduan Games took another step further: a German action parkour game was signed and launched to the global market.

Le Dou recently reached a strategic cooperation with Huawei to jointly promote China's high-quality games to the world.

"Huawei has very deep cooperation with operators overseas, and Huawei's mobile phones also have large sales. We have rich experience in game promotion and operation. We believe we can help China's games go global." Guan Song, CTO of Le Dou, who is in charge of the matter, said that overseas is still a big market, especially emerging markets such as South America and Africa.

At present, Metro Parkour and Temple Escape released by Leduan Games account for a large share of the Parkour casual game market in China. Chen Xiangyu told reporters that he wanted to extend the advantages of Leju Games in the parkour market to overseas.

When cooperating with top international mobile game developers, Ledao Games requires the other party to authorize the source code in order to deeply localize the product. In this process, Leju Games has accumulated rich technology and experience.

Chen Xiangyu told reporters,"Frankly speaking, we are not inferior to major international manufacturers in terms of research and development, technology, operations, etc. We left the U.S. capital markets to allow our business to perform better in global markets."

"With the rise of great powers and the export of culture, I believe that games are a good way to export culture." Chen Xiangyu said that we must not only introduce high-quality overseas content to China, but also introduce domestic excellent cultural and creative products to global users."

Editor: rainshine