Tencent rumoured to have bought China's #1 gaming website for $1 billion

Although we recently attempted a thought experiment to consider the potential of the Chinese market minus its dominant player, Tencent (HKG:0700) just keeps on buying capacity.

The internet and gaming behemoth is now rumoured to have bought #1 Chinese gaming website 17173.com for $1 billion.

Previously owned by Chinese game publisher Changyou (NASDAQ:CYOU), the site was restructured in late 2014, resulting in 100 job losses.

Powerful play

In terms of these rumours, earlier in January 17173.com's GM Zhao Jia confirmed that Changyou had sold the website, but not to who.

17173.com would be a powerful addition to Tencent's gaming business thanks to its ability to generate advertising revenue as well as promotion and discovery of the games that Tencent is publishing and distributing.

Obviously, Tencent's position would also be strengthened by taking an asset from a competing publisher, even at the cost of a large amount of cash - something it really doesn't lack,

[source: Marbridge]