Report: Riot Owner Tencent Holdings Negotiating With CFIUS to Avoid Forced Divestment of U.S.Game Holdings – The Esports Observer

Tencent Holdings has been in talks with the U.S. government to avoid selling its stake in Riot Games and Epic Games, according to a Reuters report. 

The company has been talking with a security panel with the Committee on Foreign Investment in the United States (CFIUS) for the past six months. We reported last year that the U.S. government may be taking aim at Tencent over its U.S. holdings.

 The United States Treasury declined to comment, citing confidentiality obligations: “Consistent with CFIUS’s statutory confidentiality obligations, Treasury cannot comment on potential or actual cases under review,” said Todd Martin from the Public Affairs office of the U.S. Department of the Treasury.

An Epic Games spokesperson had  “no comment” on this story.  Similarly, a Riot Games Spokesperson declined to comment, but did say that “Tencent is largely hands-off as an owner and Riot operates independently of its parent company.“

Tencent owns roughly a 40% stake in Fortnite maker and Rocket League owner Epic Games, and 100% of League of Legends, Valorant, Teamfight Tactics, and Wild Rift maker Riot Games.  

The CFIUS has been looking closely at whether the company’s handling of the personal data  of U.S. customers may constitute a national security risk because it is a Chinese company, according to sources,.

To deal with these concerns by the U.S. government, Tencent is reportedly negotiating risk-management measures with the CFIUS, but what those measures entail remains unknown as of this writing.

One source speaking to Reuters said that Epic does not share user data with Tencent. Sources also cautioned that just because Tencent is in talks with the government does not ensure that it will be able to come to an agreement.

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