Tencent Said to Sign $3.5 Billion Supercell Acquisition Loan

  • Firm is leading a $8.6 billion deal for control of Supercell
  • Financing comes as Tencent expands content shopping spree

Inside Tencent's Global Investment Strategies

Tencent Holdings Ltd. is signing a $3.5 billion loan to back its purchase of a majority stake in Supercell Oy from SoftBank Group Corp., people familiar with the matter said.

Asia’s biggest internet company has finished getting commitments from 23 banks, the people said, asking not to be identified because the details are private. Tencent is leading a $8.6 billion deal for control of Supercell, the Finnish maker of mobile games including Hay Day, Clash Royale and Boom Beach.

Tencent’s shopping spree on premium content from Game of Thrones to NBA broadcasts has helped defy investors’ expectations that it would be hit by the slowing Chinese economy. The firm is paying upfront for rich media titles to tap the purchasing power of its billion-plus users and appeal to advertisers. China’s Internet giants have been enjoying demand for “new economy” investments, with the nation’s biggest e-commerce company Alibaba Group Holding Ltd. getting a $4 billion loan earlier this year.

The dual-tranche facility is for five years, and in the event of default doesn’t give creditors recourse to anything except the collateral, the people said. Commitments include $1 billion from Bank of China Ltd., $700 million from Shanghai Pudong Development Bank Co. and $400 million from China Merchants Bank Co., according to the people.

Canny Lo, a spokeswoman for Tencent, didn’t immediately respond to an e-mail and text query.

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