author: Left Bank, the original title: “Overseas market’s ability to defend the crown” giants “game journey? “, the title picture comes from: Visual China

Although Playtika was acquired in 2016 in a “snake swallowing elephant” manner, the important task of Giant Network is still the last step-to incorporate it into the listed company system.

But Shi Yuzhu also has his own plan B. Recently, there is news that Playtika has reported to the US Securities and Exchange Commission in a low-key manner (SEC)Submitted documents and is expected to be listed in the United States at the end of 2020 or early 2021. Not long ago, Giant Network also issued an announcement that Playtika intends to seek its first overseas listing. It is reported that Playtika plans to raise 1 billion US dollars this time, and its valuation may reach 10 billion US dollars.

The listing of Playtika is particularly important for Shi Yuzhu and his giant network.


1. Giant network “curve to save the country”

As a legend in the domestic business community, the outside world always likes to look back at Shi Yuzhu’s wonderful past, but the term Shi Yuzhu and Playtika have been deeply tied together in the past two years.

As an Israeli game company established in 2010, although Playtika has the name of artificial intelligence, its main business is games like Giant Network. The only difference is that Giant focuses on traditional online games like “Zhengtu”, while Playtika focuses on chess and card games.

Shi Yuzhu’s relationship with this game company can be traced back to November 2016, when Giant Network Backdoor Century Cruises returned to A shares for one year, and the company name has not been changed to Giant Network. At this time, the overall size of the Giant Network is far from that of Playtika, and the overall revenue and net profit are far less than the latter, so that shocking acquisition was also called “Snake Tunxiang” by the outside world.

At that time, Shi Yuzhu convened many investment institutions including Yunfeng Fund (Yunfeng Capital), a private equity firm founded by Jack Ma, and spent 4.4 billion Dollar acquired Playtika from Caesars Interactive Entertainment.

Although Playtika’s overall business situation is good, the acquisition has never been approved by the Securities Regulatory Commission due to the high suspicion of gambling in its main board game itself. This delay lasted for three years, the acquisition plan has also undergone several adjustments, and the acquisition plan was once terminated.

Finally, at the beginning of July this year, Giant Talents made an official announcement: Jukun Network, a shareholding subsidiary, completed the acquisition of Chongqing Cibi through capital increase and owns 100% of Chongqing Cibi. While Chongqing Cibi holds 42.04% of Alpha, the core asset of Alpha is Playtika.

There have been rumors that the “family and friends group” who was originally called by Shi Yuzhu were dissatisfied with the repeated delays in the acquisition of Playtika. The series of reductions by giant shareholders Hongyi and CDH may be a chain reaction derived from this. After all, the cost of such a large sum of funds can be imagined. Fortunately, this protracted acquisition has finally achieved initial results.

Interestingly, shortly before it indirectly took part of Playtika’s equity, Giant Networks just sold another domestic board and card game company. In September, Giant Network sold the entire equity of Hefei Lingxi, its wholly-owned subsidiary, to Shanghai Zhuoxian in two times, and received a total of 475 million yuan in funds.

While buying a chess and card game company and selling a chess and card game company on the other, this buying and selling of Giant Network is worthy of fun.

In this regard, some game industry observers said: “Shi Yuzhu is interested in Playtika not only for its profitability, but also for its AI technology and opening up the international market. Playtika is compared to other competitors in AI technology. Really have to be a lot ahead, through related technologies, we can continuously improve the fineness of our gamesOperations. In addition, the current Playtika business covers many overseas countries, which is also what the giant needs. In comparison, Hefei Lingxi is simply a divestiture of assets, somewhat similar to the original divestiture of Wangjin Finance. “

According to the official statement of Giant Network, the sale of Hefei Lingxi is to better focus and focus on the core business. From another perspective, Giant Network probably not only needs to focus on its core business, but also needs to use the overseas market to boost its morale in the capital market.

After backdooring back to A in October 2015, the stock price of Giant Network has gone up all the way, and its market value was once as high as 170 billion yuan. However, the good times did not last long. After a short period of time hitting the peak, its stock price ushered in a long decline. Now the market value is only 36.5 billion yuan. (as of October 19)< /span>, compared to the peak, it fell by nearly 80%.

In terms of business performance, in 2019, the company achieved operating income of 2.571 billion yuan, a year-on-year decrease of 31.96%; net profit attributable to shareholders of listed companies was 820 million yuan, a year-on-year decrease of 23.9%. In the first half of this year, revenue was 1.22 billion yuan, a decrease of 6.35% from 1.3 billion yuan in the same period last year. Net profit was 527 million yuan, an increase of 4.4% from 505 million yuan in the same period last year.

Under the background of many game companies having a good harvest in the first half of the year, the situation of Giant Network can be imagined. This time, the acquisition of Playtika was completed through the “curve to save the country”. Giant Network stated that the performance of “Playtika” will be reflected in the group’s 2020 third quarter report. Obviously, Playtika’s better revenue and profit are the elements that Giant Network needs most at this stage.


Second, all vents have passed afterwards

Wu Xiaobo once commented on Shi Yuzhu in his “The Great Lost”: He has a natural gambling nature full of grass and recklessness, and this is an endowment necessary for entrepreneurial entrepreneurs. .

Although Shi Yuzhu, now 58 years old, often calls himself a big idler, in the past two decades, he has actually had an easy time. From the early 90s when he earned 1 million in 4 months with the Han card, to the end of the Giant Building and becoming the domestic “first loser”, to the start of melatonin and realizing a comeback, Shi Yuzhu completed many major changes. After thatThe giant network with a market value of more than 170 billion yuan, coupled with the long-term investment in Minsheng Bank in recent years, especially good personal relationships with well-known entrepreneurs such as Jack Ma, have achieved the Nth peak of his life.

In fact, as early as April 2013, Shi Yuzhu published a retirement declaration on Weibo. At that time, he said that he had resigned as CEO of Giant Network and completely retired. But in less than three years, Shi Yuzhu returned to the giant again. One of the most important measures after the announcement of the return at the end of 2015 was to operate the giant to return to A.

In addition to the main game industry of Giant Network, Shi Yuzhu is still chasing the trend. In 2017, catching up with the mutual gold boom, it acquired 40% of Shenzhen Wangjin Finance at a price of nearly 819 million yuan, and was entrusted to exercise 11% of the voting rights of other shareholders. Catching up on the trend, Mutual Finance once accounted for 30% of Giant Network’s revenue, and Mutual Finance once became an important support for Giant Network’s business diversification. However, with the continuous occurrence of thunderstorms in the P2P industry, the severe external environment also makes it relatively high risk.

Finally, at the end of 2018, Giant Network announced the divestment of mutual gold business at a price of 479 million yuan.

In addition to mutual funds, Shi Yuzhu also took a fancy to a series of vent projects such as blockchain, insurance, and long-term rental apartments, but ultimately failed to make substantial progress.

From a certain point of view, the term “Chu Fengkou” may be familiar to Shi Yuzhu. From the initial Hanka, later melatonin, to online games and even the financial industry, they are the most popular outlets of the time. And Shi Yuzhu, who is good at observing the market, also seized these opportunities and created one after another. In the past two years, Shi Yuzhu has continued to do the same, working hard on the front line, but in the end he was unable to wait for new hot models.

How does Giant Network face the future?

Actually, “The Journey” may be Shi Yuzhu’s only truly successful work after melatonin. ThisKnown as the “most krypton gold in the history of domestic online games”, the game independently supported the entire Giant Network almost ten years after its birth.

If the company’s revenue can be supported by the popularity of a self-developed game, then it can be said that the game itself and the developer are both successful. But if the game is still the main revenue source of a company 15 years after its release, it can only make the outside world lament the strong vitality of this IP, but also question the company’s innovation.

3. The loneliness of “fancy nesting doll”

Giant Networks is currently facing such a problem. The 15-year-old “Zhengtu” is still the company’s core IP.

At present, Giant’s PC-side online games mainly have 4 products, “Zhengtu”, “Zhengtu 2”, “Green Journey”, and “Zhengtu Nostalgia”; at the same time, there are “Zhengtu Mobile Games”, “Zhengtu 2 Mobile Games” and “Green” on the mobile terminal. “Zhengtu Mobile Games” etc. To be able to derive so many products from one IP at the same time, we must also admire the giant’s “moll” ability.

In addition to “Zhengtu”, the mobile game “Battle of the Ball” can be regarded as a relatively successful product of Giant Network in the past five years. According to the official disclosure of the giant, its cumulative equipment installation has reached 600 million units, and its peak DAU has exceeded 29 million.

At present, the two IPs of “Ball Ball” and “Zhengtu” have jointly supported most of the giant’s revenue, but even the “young” “Ball Ball” has been released so far. In 5 years, for a mobile game, the life cycle has gradually entered a decline.

Five years ago, Shi Yuzhu made large-scale adjustments to the company when he returned to take control of the company. One of the most important aspects was to increase R&D investment. At that time, he announced that the salary of all front-line R&D staff would be increased by more than 50% on average, and he promised that the net worth of the producers who made masterpieces would exceed 100 million. Shi Yuzhu hopes to stimulate employees and create better products.

But from the final effect, there is no “brave man” under the heavy reward.

For the status quo of Giant Network, there is an analysis of the game industryThe teacher said to understanding: “Assure a successful IP with a longer life cycle as much as possible, which is what every game company will do. However, the way for those excellent game companies to continue the vitality of IP is to rely on this IP to continuously introduce innovative power. Although the Giant has launched various “Zhengtu” products, most of them are changed without changing the medicine. Doing so will only overdraw the IP value of the game.”

In addition, the above-mentioned analysts pointed out: “Playing games is a trial and error process, and failures account for the majority. It is precisely because of this that many companies, especially those that have been listed, will be more cautious in order to ensure financial reports. It shows that companies are more willing to launch some products that are just “replacement” but can guarantee revenue, but doing so will bring the company into a slack state of boiling frogs in warm water.”

Of course, Giant Network has not tried to launch new games in the past few years. At the Apple Autumn Conference in September last year, as an example of the excellent performance of the A13, the 3D action mobile game “Pascal Contract” developed by the Giant Network TipsWorks Studio debuted for the first time, and a live demonstration was made.

This appearance has attracted a lot of attention, but from the perspective of the game itself, the excellence of “Pascal Contract” can hardly conceal the shackles of its buyout game form, causing the work to fail to receive good market feedback in the domestic market. From a business perspective, it is basically not successful.

Fortunately, the appearance of “Pascal Contract” has proved the R&D strength of Giant Network, and the studio is now willing to spend more time and resources to try to create a real boutique game.

As the aforementioned analyst said, playing a game itself is a trial and error process. Ability and willingness does not mean that you can make a successful game, especially the kind of successful game and commercial success at the same time. This is also the key to test the giant’s network endurance.

Aging IP and single product are not the problems facing Giant.com, including Shengqu, Perfect World, Ninetowns, Changyou, etc. At present, most established game companies in China are facing the same problems. Perhaps, facing a new generation of gamers, these established game companies should put aside their bodies and learn from the newcomers in the game industry such as Mihayou and Lilith.

author: Left Bank