Ninth City (NCTY.US) and Qzone Network have formed a joint venture to operate and distribute mobile games in China.

Nine City Digital (NCTY.US) announced on Friday that its wholly-owned subsidiary, Shanghai Ninth City Information Technology Co., Ltd., has signed a joint venture agreement with Chengdu Qingcheng Network Science & Technology Co., Ltd., a company focused on the operation and distribution of mobile games for gamers in the Chinese market.

Nine City Digital will hold 51% of the joint venture, while Chengdu Qingcheng Network Science & Technology will hold 49%. The joint venture will become the flagship subsidiary of Nine City Digital in the Chinese market for the operation and distribution of mobile games.

Chengdu Qingcheng Network Science & Technology has committed to leveraging its unique distribution channels in the lower-tier market to operate different mobile games for the joint venture.

Chengdu Qingcheng Network Science & Technology has committed that the annual profit of the joint venture will exceed RMB80mn (approx. US$11mn) in 2025, and at least grow 50% annually in 2026 and 2027.

Nine City Digital granted Chengdu Qingcheng Network Science & Technology 110.2mn restricted shares (equivalent to 3.67442 shares of American Depositary Shares). These restricted shares will be unlocked in phases based on the profit realization of the joint venture.