Animoca Brands Corporation Ltd (ASX:AB1) has entered into a collaboration framework agreement with iClick Interactive Asia Limited (NASDAQ:ICLK).
The two companies will establish a strategic partnership with the goal to jointly develop and grow an online marketing business serving the video game sector.
iClick is an independent online marketing technology platform that connects worldwide marketers with audiences in China.
It was ranked China's largest independent online marketing technology platform in terms of gross billing in 2018 Q1-Q3 by Frost & Sullivan.
Reselling agreement to be finalised in the near-term
Animoca and iClick are now working to finalise a strategic reseller partnership wherein Animoca will become a strategic reseller of iClick’s online marketing services.
The goal is to assist iClick in expanding into the international video gaming markets currently served by Animoca Brands.
Notably, the reseller agreement is expected to generate revenues for Animoca of around US$8 million (about A$11 million) in the calendar year 2019.
China is a massive gaming market
Animoca believes that the partnership will unlock significant opportunities for new audience reach and revenue generation in China, the world’s largest mobile gaming market with over 25% of global games revenue.
China’s mobile games domestic revenue is projected to grow from US$16 billion in 2018 to US$24.7 billion in 2022, and the number of mobile gamers is set to increase from 598 million in 2018 to 720 million in 2021.
READ: Animoca Brands board members acquire company shares
In order to support business expansion, Animoca has raised $6 million at a premium price of 9.8 cents per share from strategic investors.
Investors include Katherine Yip, founder of Pacific Alliance Group and co-founder and partner of Vina Capital, Moses Tsang, founder of AP Capital and founding chairman of Goldman Sachs Asia Pacific, Sonny Vu, founder of Misfit (later acquired by Fossil Group for US$260 million), and Yat Siu, chairman and co-founder of Animoca Brands.
Animoca's co-founder and chairman Yat Siu said: “By partnering with iClick, we aim to significantly expand the marketing and distribution capabilities of Animoca Brands in China.
"We look forward to collaborating with the largest independent Chinese online marketing platform, and to utilise this rare opportunity to leverage - including through our AI subsidiary Zeroth - the valuable data assets of over 780 million Chinese user profiles.”