Sumo-Tencent deal under US security investigation

A US national security panel — the Committee on Foreign Investment in the United States (CFIUS) — is investigating the £919 million takeover of Sheffield-based video gaming firm Sumo Group plc by a subsidiary of China’s Tencent.

Sumo has studios in the United States and its clients and partners include Microsoft’s XBOX game studios, Apple and Google.

“On 7 September 2021, Sumo and Tencent notified the Committee on Foreign Investment in the United States (CFIUS) of the acquisition, and on 28 October 2021, CFIUS informed Sumo and Tencent that it is undertaking an investigation of the acquisition (the CFIUS Review) …” said Sumo in a stock exchange statement.

In clause 3.2(c) of the Cooperation Agreement, Tencent and Tencent Bidco have agreed to offer undertakings in connection with obtaining clearance from CFIUS.

“Tencent and Sumo are actively engaging with CFIUS with the aim of obtaining clearance from CFIUS before the end of the year.

A further announcement will be made by Sumo and Tencent when the outcome of the CFIUS Review is known.”