Alibaba to Sell Entire Stake in Lingxi Games to Trustar Capital in Deal Exceeding $2 Billion
Alibaba Group plans to sell its entire stake in its game development subsidiary, Lingxi Games, to the private equity firm Trustar Capital. The transaction is expected to exceed $2 billion, according to a person familiar with the matter.
The deal comes at a time when the tech giant is redirecting its resources toward Artificial Intelligence (AI) and cloud computing, alongside a broader strategic review of its non-core assets.
According to an internal memo sent to employees by Lingxi Games CEO Zhou Bingshu, Alibaba and Trustar have reached a formal agreement after several rounds of negotiations. Under this agreement, Alibaba will transfer its complete stake in the gaming company to the new buyer.
Transaction and Strategic Details
The table below outlines the key components of the deal and the accompanying strategic shifts:
Deal DetailAvailable Information
SellerAlibaba Group
BuyerTrustar Capital (Private Equity)
Target CompanyLingxi Games (Game Development)
Expected ValuationOver $2 Billion (Previous Bloomberg reports estimated the value at a minimum of $1.5 billion)
Management & OperationsCurrent management, led by Zhou Bingshu, will continue to lead the company after the ownership change, ensuring studio operations continue without major disruptions.
Seller's Strategic GoalDivesting non-core assets to concentrate capital and executive focus on strategic areas, primarily AI and Cloud Computing.
Strategic Shift Toward Artificial Intelligence
While the internal memo did not disclose the final transaction value, the expected completion date, or the specific regulatory approvals and conditions required, the sale clearly aligns with Alibaba’s comprehensive portfolio review.
By exiting non-core assets like the gaming sector, Alibaba aims to refocus its financial and managerial attention on strengthening its infrastructure and competitiveness in advanced technology fields, specifically the highly competitive global markets for Artificial Intelligence and cloud computing.