STOCKHOLM (Reuters) - Shares in MTG (ST:MTGb) soared 24% on Monday after the Swedish e-sports and gaming firm said Chinese live streaming platform Huya (N:HUYA) would buy a stake in its portfolio company Turtle Entertainment (ESL) and help it expand into China.
Huya, backed by internet giant Tencent (HK:0700), will invest $30 million in ESL, at an enterprise value of $425 million, MTG said.
Huya and ESL, the largest e-sports company in the world, will also form a joint venture, while ESL will issue $22 million worth of new shares to facilitate further expansion, it said.
"We are excited to announce this term sheet for an important strategic partnership which provides us with a strong partner in Huya to pave the way for a successful ESL expansion into the thriving Chinese e-sports and gaming market in due time," MTG Chief Executive Jørgen Madsen Lindemann said in the statement.
The Chinese e-sports market is expected to generate revenue of $210 million this year, overtaking Western Europe as the second-largest e-sports region globally, MTG said.