Allied Gaming & Entertainment has taken a big strategic move by purchasing a controlling investment in Beijing Lianzhong Zhihe Technology Co., a mobile games developer. According to the terms of the agreement, Allied will invest around $7.0 million to buy Ourgame International Holdings’ investment, as well as a majority position in Zhihe’s board. The transaction is expected to close by the end of September, subject to certain closing conditions.
The acquisition of a controlling share in Beijing’s Zhihe Technology by Allied marks a watershed moment in the company’s strategic trajectory. The purchase, which comes with a majority stake on Zhihe’s board, fits in well with Allied’s larger goals and the development of its Allied Mobile Entertainment (AME) subsidiary.
Yinghua Chen, CEO of Allied, expressed enthusiasm for the strategic investment, emphasizing the synchronicity between Zhihe’s accomplishments and Allied’s overarching goals. Chen noted, “Zhihe brings a compelling library of popular mobile games that will bring significant traction to AME, while also providing distribution channels for our current portfolio of casual mobile games.” The collaboration between the entities is envisioned to create value and unlock synergies that will further fortify both companies.
The acquisition comes on the heels of Allied’s recent release of its second-quarter and first-half financial results. The company reported notable revenue growth, with Q2 revenue surging by 182.3% to $3.3 million compared to the previous year, and a first-half revenue increase of 25.0% to $4.5 million.
The acquisition of a majority share in Zhihe Technology demonstrates Allied’s strategic evolution. In late 2022, the corporation started on a significant overhaul, widening its emphasis outside esports. As a result of this strategy shift, two companies were formed: AME and Allied Experiential Entertainment (AEE). AME operates in the dynamic mobile gaming sector, whereas AEE is involved in entertainment live events and immersive entertainment venue management.
The transition from Allied Esports Entertainment to its current name, Allied Gaming & Entertainment, represents the company’s evolution. The strategic purchase of Zhihe Technology demonstrates Allied’s commitment to diversification and development, marking yet another milestone on its drive to reshaping the gaming and entertainment environment.
With the transaction expected to close in the coming months, the gaming and entertainment sector is ready to benefit from Allied’s partnership with Zhihe Technology. This collaboration offers innovation, value creation, and an exciting future for both companies as they negotiate the market’s changing expectations.
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