British studio Sumo Digital, creator of LittleBigPlanet 3 and Sackboy is now part of the Tencent family

Tencent buys British game studio Sumo for $1.3 billion

The British development studio that created Sackboy and LittleBigPlanet 3 has now been bought by Chinese game conglomerate Tencent for $1.27 billion.

Besides bringing Sackboy to life for Sony PlayStation, Sumo Digital also assisted IO Interactive on Hitman 2, made the Xbox One exclusive Crackdown 3, supported development for Sonic and Sega All-Stars racing, and has had a hand in major titles that have been released over the last decade.

Tencent already has a major stake in big publishers around the world like League of Legends creator's Riot games or Activision Blizzard and Epic Games. Tencent is already the second-largest video game conglomerate in the world behind Sony.

Sumo Digital has fourteen game studios spread across five countries and now Tencent owns 8.75% stake in them. Each of Sumo's shares have now been appreciated by 43% compared to its previous valuation and a premium of $5.13 will be paid to the shareholders.

“The business will benefit from Tencent’s broad videogaming ecosystem, proven industry expertise and its strategic resources, which will help secure and further the aspirations and long-term success of Sumo,” Ian Livingstone, non-executive chairman of Sumo, said in a statement.

Interestingly, Tencent is facing major regulatory pushback at home in China and is currently negotiating a deal in the US that would allow them to retain ownership in companies like Riot Games and Epic Games.