Stillfront Group Acquisition of KIXEYE, Inc.

Stillfront Group’s acquisition of KIXEYE, Inc. serves to bolster the company’s market position and expand its portfolio of indie game developers. By integrating KIXEYE’s established expertise in free-to-play gaming and its portfolio of four live blockbuster titles—including Battle Pirates and War Commander: Rogue Assault—Stillfront aims to enhance its overall scale, revenue, and EBITDA. The transaction is expected to be accretive to both EBITDA margins and earnings per share starting in the third quarter of 2019.

Financial data for the first quarter of 2019 highlights the impact of the acquisition, with the combined entity reporting pro forma net revenues of SEK 547 million and an adjusted EBITDA of SEK 219 million. KIXEYE contributed SEK 128 million in net revenue and SEK 65 million in adjusted EBITDA during this period. The acquisition terms include an upfront cash payment of USD 90 million on a debt- and cash-free basis, with a potential performance-based earn-out of up to USD 30 million payable in 2020, contingent upon 2019 EBITDA performance.

The acquisition aligns with Stillfront’s broader strategy of acquiring and developing studios through shared best practices in performance marketing, live operations, and multi-platform engineering. KIXEYE, founded in 2007 and headquartered in Victoria, Canada, brings approximately 120 full-time employees and a history of innovation in monetization mechanics. To finance the transaction, Stillfront secured a bridge loan facility and plans to raise approximately SEK 500 million in new equity alongside additional debt financing. The transaction was slated for completion by July 1, 2019, further diversifying Stillfront’s global footprint across multiple international studio locations.