Shanghai The9 Information Technology Co., Ltd., a wholly-owned consolidated variable interest entity of The9, has closed a transaction with Shanghai Zhengwu Investment Center (Limited Partnership) for sale of its wholly-owned subsidiary Shanghai Huopu Cloud Computing Terminal Technology Co., Ltd. (“Huopu Cloud”) for a total consideration of RMB200 million in cash. Huopu Cloud holds a web game QiJiGuiLai and has the right to receive a minority portion of royalties generated from operation of the game Firefall® in mainland China upon payment and other conditions. Firefall® is a MMO shooter game developed by Red 5 Studios, Inc., a subsidiary of The9.
Developing and operating MMO, web and mobile games.
The9 has obtained a fair market value appraisal from an independent valuation advisory firm prior to the completion of the transaction. The board of directors of the Company reviewed the transaction and approved it. The9 intends to use the proceeds of the sale for developing and operating its other MMO, web and mobile games.