The London-based mobile game developer Tripledot Studios is interested in purchasing AppLovin's games division for $900 million.

In recent months, the most talked-about adtech startup has been AppLovin, which assists app developers in generating revenue from advertising and attracting new users. AppLovin's market value has surpassed $100 billion, and its shares have surged more than 400% in the last year. AppLovin's recent stock surge was driven by a new strategy to target e-commerce advertising, despite the company's longstanding reputation for working with the gaming community.

It now wishes to leave the game-development industry and concentrate only on advertising. Lion Studios, Machine Zone, and Magic Tavern are among AppLovin's game studios. They produce over 200 free-to-play mobile games, including Popsicle Stack, Project Makeover, Game of War: Fire Age, and Mobile Strike. AppLovin's overall revenue for the fourth quarter increased 44% year over year to over $1.4 billion, but its app revenue fell 1% to a little over $376 million.

An "exclusive term sheet agreement" to sell its games studio was struck with an unknown private firm, according to a February filing for AppLovin's most recent quarterly results report. The sale was anticipated to conclude by the second quarter. The transaction, according to AppLovin at the time, was $400 million in stock and $500 million in cash, although it was still subject to the usual purchase price revisions.

Recently, well-known hedge funds have begun investing in AppLovin, including Viking Global, D1 Capital, and Castle Hook. AppLovin has emerged as the newest hedge fund hotel, according to a prime broker who spoke to BI recently. This phrase refers to stocks that have a disproportionate level of hedge fund ownership in comparison to the market as a whole.