VK, one of the largest IT companies in Russia, has decided to sell its gaming division MY.GAMES. The deal is worth $642 million.
Warface: Breakout
What happened?
- VK completed a multi-stage deal to sell 100% of MY.GAMES to Aleksander Chachava, the company said in a press release.
- Chachava is a serial entrepreneur and managing partner at LETA Capital, a venture capital firm that invests in software-related startups. Its portfolio includes over 30 companies.
- MY.GAMES co-founder Vladimir Nikolskiy will leave VK to continue developing the company.
- Under the terms of the deal, Chachava will receive all business assets of MY.GAMES, including games and development studios.
- VK, in turn, will develop its gaming products under the recently launched VK Play brand.
The premise of the deal
- The holding company, formerly known as Mail.ru Group, announced last year that it was rebranding to VK. It changed the names of some of its products and proposed a more unified vision of its ecosystem.
- VK operates a lot of popular online services for the Russian-speaking segment of the Internet, such as social network VK, email client Mail.ru, a cloud storage, and streaming platform VK Music.
- Earlier this year, it was reported that VK plans to sell MY.GAMES in the wake of potential sanctions against its global business. The US and EU eventually sanctioned its CEO Vladimir Kiriyenko due to his father’s ties to the Kremlin (Sergey Kiryenko is Russia’s first deputy chief of staff)
- “The problem is that MY.GAMES is the main source of foreign exchange earnings, and the sanctions imposed on the company’s CEO might raise questions among foreign partners,” a source told at the time.
- Considering that MY.GAMES is branded as a global company, VK likely decided to get rid of this division and launched the VK Play brand, which is more focused on the domestic market.
What is known about MY.GAMES?
- Mail.ru Group launched the MY.GAMES brand in 2019 to consolidate its gaming business under one division. It is focused on developing and publishing games for PC, console, and mobile devices.
- MY.GAMES has invested in and acquired several studios over the past few years. It currently operates 14 first-party teams, including Pixonic, Deus Craft, BIT.GAMES, and Mamboo Games.
- The company’s portfolio includes over 150 titles, such as War Robots, Warface, Left to Survive, and Allods Online.
- In 2021, MY.GAMES reached $595 million in revenue, with its EBITDA more than doubling year-over-year.
- As of now, the company has 12 offices across Russia, Europe, Asia, and the US. Following the deal, it will develop its business globally without any connection to VK or Russia.