China’s Tencent Holdings Ltd is looking to acquire the Xiaomi backed gaming smartphone manufacturer Black Shark according to a report by Bloomberg. This deal will allow Tencent to move forward with its ambitions for the metaverse. Also Read - OnePlus 9RT vs Xiaomi 11T Pro: Battle of the flagships
According to a report by Bloomberg citing anonymous sources, Tencent has begun talks to purchase Black Shark, which after the deal will pivot towards manufacturing virtual reality headsets for the tech behemoth. Also Read - Biggest acquisitions made in the gaming industry: Microsoft-Activision Blizzard, Tencent-Supercell, and more
Black Shark currently manufactures gaming smartphones and accessories. The company already constitutes big-name investors like Xiaomi Corp. Also Read - Xiaomi Redmi Note 11 Pro renders, key specs leak online ahead of launch: Take a look
The news about the potential acquisition was previously reported by local trade publication 36Kr.
In a separate report, it is being said that Tencent Games will acquire Black Shark for approximately Yuan 3 billion, which when converted comes to a little over $470 million.
While the Bloomberg report claims that Black Shark will focus on virtual reality headsets. Other reports claim that the company will continue to manufacture and sell gaming phones. To recall, Tencent has earlier partnered with Asus and Nubia to launch special edition gaming smartphones, and with the help of Black Shark, it will not need to strike any partnership deals with other smartphone manufacturers.
With Black Shark, Tencent will also be able to bring its gaming devices overseas, considering that Black Shark has already penetrated some of the key markets across the globe.
Tencent has been quite vocal about its ambition to create a metaverse of its own. In a recent earnings call, Tencent President Martin Lau stated that metaverse is “a real opportunity.” However, Lau also stated that development may take longer than expected to bring metaverse into reality.
Specialised hardware is a key aspect of the metaverse, and conglomerates like Meta and Tencent know that. Meta being sort of a leader in the space, bought Oculus in 2014 to manufacture headsets. While another Chinese company ByteDance Ltd is also looking to capture the market, and last year purchased Pico, a domestic VR headset maker.