The Motivations and Performance Analysis of Cross-Border Mergers and Acquisitions: A Case Study of Tencent’s Acquisition of Sumo Group

Hangzhi Zhou ()
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Hangzhi Zhou: International College, Guangzhou College of Commerce

A chapter in Proceedings of the International Workshop on Navigating the Digital Business Frontier for Sustainable Financial Innovation (ICDEBA 2024), 2025, pp 171-180 from Springer

Abstract: Abstract In recent years, with the substantial growth of China’s economic power, the government has actively promoted the “going out” strategy, encouraging a growing number of Chinese enterprises to participate in cross-border mergers and acquisitions. Through these mergers and acquisitions, companies can not only take full advantage of both domestic and international markets and resources but also expand their global reach, thereby significantly boosting their international competitiveness. With the globalization of the gaming industry, Tencent Holdings, a leading domestic gaming company, has further strengthened its global leadership by acquiring the British gaming firm Sumo Group. This paper examines Tencent’s acquisition of Sumo Group, analyzing the motivations, process, and financial data. The findings suggest that Tencent’s merger and acquisition activities are primarily driven by market expansion and the desire to enhance its own competitiveness. Following the merger, Tencent achieved economies of scale and synergy through resource integration and market expansion, leading to improved profitability and greater market competitiveness.

Keywords: Cross-Border Mergers and Acquisitions; Market Expansion; Resource Integration (search for similar items in EconPapers)
Date: 2025
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DOI: 10.2991/978-94-6463-652-9_18

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