Mergers & Acquisitions reports and market data
Documents
MTG Capital Markets Update 2022
Modern Times Group has successfully transitioned into a pure-play gaming entity, marking a strategic pivot defined by the divestment of ESL Gaming and a renewed focus on scaling evergreen mobile franchises.
- Modern Times Group has transitioned into a pure-play gaming entity, targeting a 7–10% organic revenue CAGR and a doubling of EBITDA by 2025.
- The company aims for an adjusted EBITDA margin of 23–25% and a cash conversion rate of 50–60% to support future acquisitions and shareholder distributions.
- The business model centers on Games as a Service (GaaS) across strategy, word, and simulation titles, utilizing the Flow platform for shared data and cross-promotion.
Global Gaming Report Q1 2022
The global gaming industry experienced a historic surge in financial activity during the first quarter of 2022, recording a record-breaking $98.7 billion in total deal value.
- The global gaming industry reached a record $98.7 billion in total deal value in Q1 2022, surpassing the total deal value of the entire previous year.
- Industry consolidation was driven by major acquisitions, including Microsoft’s $68.9 billion purchase of Activision Blizzard and Take-Two’s $11.8 billion acquisition of Zynga.
- Strategic M&A activity is currently focused on cross-platform diversification, with PC and console giants aggressively acquiring mobile gaming expertise and established intellectual property.
Global Gaming Report 2021
The global gaming industry experienced an unprecedented surge in financial activity during 2021, reaching a landmark $85 billion in total deal value across 1,159 transactions.
- The global gaming industry reached a landmark $85 billion in total deal value across 1,159 transactions in 2021, nearly tripling the previous year's figures.
- Mergers and acquisitions totaled $38 billion, driven by strategic activity from major players like Tencent and Embracer Group, while private placements hit a record $13 billion.
- Blockchain and NFT-based gaming emerged as a significant sector, securing $3.6 billion in total financing and accounting for nearly half of all private investment in the fourth quarter.
Gaming Deals Activity Report: Q1–Q3 2022
The gaming investment landscape in the first three quarters of 2022 reflects a significant market correction following a record-breaking 2021.
- The $124.5 billion total deal value for Q1–Q3 2022 is heavily skewed by Microsoft’s $69 billion acquisition of Activision Blizzard, masking a broader market cooling driven by macroeconomic instability and regulatory pressure.
- Strategic M&A activity reached a record $101.4 billion despite a 40% decline in the number of closed transactions, with major activity led by Embracer Group, Sony, and Saudi Arabia’s Public Investment Fund.
- Public offerings have nearly collapsed to their lowest point since early 2020, with deal values shrinking fivefold compared to 2021 levels.
Gaming Deals Activity 2021
The video games industry experienced a record-breaking financial year in 2021, with the total value of closed transactions reaching $71.3 billion across 937 deals.
- The gaming industry saw record financial activity in 2021, with closed transactions totaling $71.3 billion across 937 deals, representing a 2.1x increase in value and 1.4x increase in volume over the previous year.
- Mergers and acquisitions were the primary growth driver at $34.5 billion, with mobile gaming capturing 49% of that value, followed by 34% for PC and console gaming.
- Public offerings, including IPOs and SPACs, generated $24.8 billion in value, while private investments doubled to $12 billion, primarily driven by late-stage funding.
Embracer Group Acquires Shiver Entertainment
Embracer Group has finalized the acquisition of Shiver Entertainment, a Miami-based game development studio founded in 2013.
- Embracer Group has acquired Miami-based Shiver Entertainment, integrating the studio into its Saber Interactive business unit to expand U.S. development capacity.
- Shiver Entertainment is expected to contribute SEK 40–60 million in operational EBIT for the 2022/2023 fiscal year, increasing to SEK 70–90 million in 2023/2024.
- The acquisition is structured as a combination of cash and shares, featuring an earn-out arrangement that incentivizes the founding management team for up to eight years.
Embracer Group Acquires DIGIC Pictures
Embracer Group has finalized the acquisition of DIGIC Pictures, a Budapest-based animation studio specializing in high-end 3D cinematics and commercial trailers for the global video game and film industries.
- Embracer Group has acquired Budapest-based animation studio DIGIC Pictures, integrating the 400-employee firm into its Saber Interactive business unit.
- DIGIC Pictures reported net sales of SEK 240 million and an operational EBIT of SEK 50 million for the 2021 calendar year.
- The studio is projected to contribute between SEK 60 million and SEK 80 million in annual operational EBIT through the 2023/2024 period.
Embracer Group Acquires Spotfilm Networx
Embracer Group has expanded its media footprint through the acquisition of Spotfilm Networx, a Berlin-based leader in the German ad-supported video-on-demand (AVOD) market.
- Embracer Group has acquired Berlin-based AVOD leader Spotfilm Networx through its subsidiary Koch Films to expand its digital media footprint in German-speaking territories.
- The acquisition integrates Spotfilm’s streaming infrastructure and 22 branded channels—including the Netzkino service—with Koch Films’ library of over 3,000 titles.
- Spotfilm currently reports significant scale with 7 million unique users, 30 million monthly video views, and 40 million monthly ad impressions.
Embracer Group Acquires Dark Horse: Presentation
Embracer Group’s acquisition of Dark Horse serves as a strategic expansion into transmedia, integrating a major comic book publisher and production house into its existing portfolio.
- Embracer Group is acquiring Dark Horse to integrate its transmedia capabilities, including a library of over 600 titles and a network of 2,000 creative professionals, into its gaming portfolio.
- Dark Horse will become Embracer’s tenth operative group, with the transaction expected to close by January 2022 and no planned restructuring.
- Dark Horse reported 2021 net sales of SEK 900 million and an operational EBIT of SEK 130 million, with projections to reach up to SEK 200 million in operational EBIT by the 2023/2024 fiscal year.
Proposed Acquisition of Asmodee: Management Presentation
Embracer Group’s acquisition of Asmodee for approximately EUR 2.75 billion represents a strategic expansion into the tabletop gaming sector, aiming to create a diversified global entertainment powerhouse.
- Embracer Group is acquiring Asmodee for approximately EUR 2.75 billion, with the transaction expected to close in the first half of 2022.
- The acquisition adds 22 studios and over 300 intellectual properties to Embracer’s portfolio, bringing the combined entity's total to over 560 IPs and 11,300 employees.
- Asmodee reported EUR 1.1 billion in pro forma sales for the 2021 fiscal year, demonstrating a resilient, high-growth business model.
Panel: The Effect of M&A on the Global Games Industry: Is the Future About Fewer, Bigger Companies?
The global games industry is currently undergoing a period of unprecedented consolidation, fueled by record-breaking capital inflows and the mainstreaming of gaming during the pandemic.
- The games industry is undergoing rapid consolidation driven by rising user acquisition costs, the need for advanced data analytics, and a strategic shift toward vertically integrated ecosystems.
- Major publishers are acquiring service-oriented firms in ad tech, development tools, and quality assurance to mitigate risks from platform policy changes and capture value across the entire gaming lifecycle.
- Blockchain-related deals currently account for approximately 20 percent of private equity investments in the gaming sector.
Fireside Chat: What the Mobile Space Looks Like as we Head into 2022
The mobile gaming industry is currently undergoing a period of rapid consolidation and structural evolution, driven by significant market growth, shifting privacy regulations, and advancements in adtech.
- The mobile gaming market is projected to reach $116 billion by 2024, fueled by an average daily consumption of 155 minutes per user.
- The industry is undergoing rapid consolidation and structural evolution as major players pursue mergers and acquisitions to scale operations and integrate monetization services.
- Monetization management has shifted from manual waterfall processes to automated, data-driven bidding, moving the focus of professionals toward product-level integration, A/B testing, and user segmentation.