Changyou.com, the online game subsidiary of Sohu.com, reached an agreement with all minority shareholders of 7Road aiming to acquire the remaining 28.074% stake from these shareholders for about USD78 million.
With the completion of the acquisition, 7Road will become the wholly-owned subsidiary of Changyou.com. 7Road is an online games developer and publisher based in China.
At the same time, 7Road's board of directors has approved the resignation of Cao Kai, former chief executive officer of 7Road; and appointed Chen Dewen, president of Changyou.com, the new chairman and acting CEO of 7Road. Chen will be responsible for the daily research and development and operation of 7Road in the new role.
Changyou.com will open more platform resources to 7Road in the future. Chen said with the acquisition, Changyou.com will further enhance its investment in the Web game sector.
Prior to this, Changyou.com acquired a 68.258% stake in 7Road in 2011. According to the agreement of the two parties, if the performance of 7Road reached the agreed standards and the company completed its IPO in Nasdaq, New York Stock Exchange, or HKEx before 2014, the company's non-controlling shareholders will have the rights to sell their shares to Changyou.com at the price agreed in advance.
Changyou.com's financial report for the first quarter of 2013 showed that the company's total income was USD177.6 million during the reporting period, a year-on-year increase of 30%; and its net profit was USD77.6 million, a year-on-year increase of 19%. Of the total income, 7Road contributed about 20%.
