(Yicai) Dec. 24 -- Chinese video game developer Perfect World said it plans to sell one of its studios to US peer Scopely for USD34.5 million, with the aim of optimizing its business strategy and recovering development costs.

Perfect World will sell Chengfeng Studio and all of its projects, data, and office equipment to Scopely by the end of next year, the Beijing-based developer announced yesterday, citing an agreement signed by the parties.

Founded in 2020, Chengfeng Studio is developing a video game called Codename PIE. Its core staff will quit and set up a new company with Scopely to continue work on the game project, with the latter as minority shareholder. Perfect World will provide severance pay to departing staff in accordance with the law, it said.

After the transaction is completed, Perfect World will remain entitled to use Codename PIE's assets in certain ways specified under the deal.

After deducting product development costs and transaction expenses, the deal is expected to bring Perfect World a net profit of about CNY120 million (USD16.4 million), positively impacting next year’s earnings, it noted.

The sale aims to optimize Perfect World’s resource allocation and business layout, enabling a swift recovery of upfront development costs related to the new game product, it said, adding that this will allow Perfect World to focus resources on more advantageous projects that align with its strategic changes.

Scopely, a mobile video game developer based in California, is a subsidiary of Savvy Games Group, which is wholly owned by Saudi Arabia's Public Investment Fund. It has released various hit games, including Star Trek Command, Marvel Strike Force, and Monopoly Go!

Perfect World’s shares [SHE: 002624] ended 1.9 percent higher at CNY11 (USD1.51) each today. The wider Shenzhen market rose 1.3 percent. Perfect World’s shares are down 7 percent since the end of last year.

Editor: Futura Costaglione