Fresh on the heels of opening a new office in North Austin, Certain Affinity announced Monday that a Hong Kong-based gaming company has acquired a minority stake in the company.
Leyou Technologies Holdings Limited invested $10 million for a 20 percent ownership stake in Certain Affinity. That follows a $5 million infusion from Austin private investment firm Capstar Partners in August.
The deal is about more than money and equity for Leyou Technologies.
The company's agreement requires Certain Affinity to develop and produce an original game with Leyou's intellectual properties. That game will be created with input from the Hong Kong-based company and will channel a portion of net revenues to the Leyou, as well.
In exchange, Certain Affinity, which has worked on popular games like Call of Duty, gets an interest-free loan of up to $15 million to develop Leyou's game, and the loan can be repaid with revenue from the game.
Leyou retains an option to buy all the remaining shares of Certain Affinity in 2021 based on an undisclosed valuation formula that won't exceed $150 million. Certain Affinity was founded in 2006, and it reports it has generated $100 million-plus in combined revenue for the Austin area.
“I have enormous respect for Alex Xu, Leyou’s CEO, and the team that he’s assembled,” Max Hoberman, Certain Affinity’s president and founder, said in a prepared statement. “This agreement launches a partnership to create an ambitious and exciting new game together, while the additional investment allows us to continue developing our own original IPs."
