Reportedly, the world’s fifth-largest internet company, Tencent Holdings has reached to the advanced stages of negotiations for an investment of an estimated $100 million in Dream11.
Tencent’s investment of Rs. 656.63 crore in an online fantasy sports platform holds the potential to change the landscape of the nascent online gaming industry in India.
According to the sources, the Shenzhen-based company which also operates We-Chat messaging platform has offered the six-year-old company a term sheet for a transaction that could approximately value $400-$450 million.
Dream11 spokesperson refrained from commenting on being asked about the speculation, and an email questionnaire sent by the Economic Times also didn’t elaborate anything on the further process.
If this deal goes on well, it would be Tencent’s second major deal with an Indian company in past two months.
It had agreed to lead a $115-million investment in music streaming service Gaana in February.
Dream11 won a judgment in their favour from the Punjab and Haryana High Court earlier this month and this development would further boost their hopes of expanding market here.
“Internet users in India is expected to touch the figures of 500 million in the coming years. And, 400 million users access the internet through their smartphones, India is an obvious destination for fantasy sports operators,” Vinit Karnik, business head at ESP Properties, the entertainment and sports division of GroupM, had said in an interview.
Analysts estimate that Dream 11 currently holds about 90 percent market share, and the number of roof operators in the fantasy segment stands at more than 60.
Indian Federation of Sports Gaming (IFSG) and AC Nielsen’s reports, the user base for fantasy sports will cross 100 million by 2020 in India.
Dream11 also boasts of association with the Hero Caribbean Premier League T20, the NBA and Indian Super League.
Its website claims to have more than two crore users and inking deal with Tencent would further expand its reach.