Tencent, the China-based megacorp that's deeply invested in large companies such as Riot Games and Epic Games, has picked up a majority stake in a much smaller company. That company is Canadian game developer Klei Entertainment.

The news comes by way of a forum post from Klei founder Jamie Cheng. He said that the partnership "helps us navigate a changing industry, and helps us focus on what we want to do best: making unique experiences that no one else can."

Cheng explained that as part of the deal, "Klei retains full autonomy of creative and operations across all aspects of the studio."

Tencent and Klei's relationship goes back to 2016, when the conglomerate began publishing Klei games in China like Don't Starve Together and more recently, Don't Stave: Newhome.

In 2020 Tencent faced some regulatory pressure from the US Government over its ownership of the messaging app WeChat. There was a brief moment where the government seemed intent on announcing an "investment ban" on the company, along with other Chinese corporations like Alibaba and Baidu.

As the Trump administration began to wind down, Reuters reported that the ban had been scrapped.