Mergers & Acquisitions reports and market data
Documents
Hunting for the Next Supercell
The gaming industry represents a massive, high-growth global market, currently valued at approximately $140 billion.
- The global gaming industry is a $140 billion market driven by 2.2 billion active gamers accessing content through major distribution platforms like the iOS App Store and Google Play.
- Game studios often achieve profitability within their first few years of operation, offering higher cash efficiency and lower capital dilution compared to typical tech startups.
- Investment strategies prioritize the development of 'evergreen' titles capable of generating stable, long-term revenue, with successful breakout hits frequently yielding returns exceeding 10x.
Investment Activity Report Q1–Q3 2020
The report documents investment activity in the global gaming industry from January to September 2020, covering mobile, PC & console, multiplatform, VR/AR, cloud-native and esports segments.
- The global gaming industry saw $27.5 billion in total deal value across 1,000 transactions during the first nine months of 2020, with gaming-specific deals accounting for $15.3 billion.
- M&A activity was defined by large-scale consolidation, led by Microsoft’s $7.5 billion acquisition of ZeniMax and Zynga’s $2 billion purchase of Peak Games, with Tencent, Zynga, and Microsoft collectively exceeding $11 billion in deal value.
- Public offerings were the primary driver of capital, generating $9.2 billion from 51 IPOs and PIPEs, while private venture investments contributed $4.7 billion across 254 rounds.
InvestGame Deals Report 2020 – Game M&A
The 2020 Game M&A landscape reached a record $33.6 billion in transaction value across 664 deals, with public offerings contributing 45% of the volume and $15.1 billion in 2020 alone, while M&A activity totaled $12.6 billion (potentially $22.2 billion when including recent mega-deals).
- The 2020 gaming market hit a record $33.6 billion in total transaction value across 664 deals, driven by $15.1 billion in public offerings and $12.6 billion in M&A activity.
- Tencent, Embracer, Stillfront, and Zynga emerged as the dominant market forces, collectively accounting for 60% of the total M&A value.
- The United States led the global market by capturing 36% of total deal value and hosting four of the year's top-10 largest transactions.
Game Developer Index: Sweden 2020
The Swedish game development industry demonstrates robust economic expansion and sustained profitability, functioning as a highly globalized export sector.
- The Swedish game industry generated EUR 2.29 billion in revenue in 2019, marking a 23 percent year-over-year increase and the eleventh consecutive year of sector-wide profitability.
- Investment activity surged significantly, with 39 transactions totaling over EUR 400 million in 2019, followed by 21 transactions valued at EUR 1 billion between January and October 2020.
- The industry workforce grew to 8,578 full-time positions by the end of 2019, with 5,599 of those employees based in Sweden and women representing 22 percent of the total headcount.
2020–2022: The Most Exciting Time in the Gaming Industry
This analysis examines global investment and merger and acquisition (M&A) activity within the video game industry from 2020 through 2022.
- M&A activity reached a historic peak in 2022 with $37.7 billion in closed deals, representing a 199% increase over 2021, largely driven by major consolidations like Take-Two’s acquisition of Zynga.
- Public offerings for gaming companies collapsed in 2022, with an 82% decline in value as IPO and SPAC windows effectively closed due to macroeconomic headwinds.
- Private investment value fell by 16% in 2022 following a doubling of investment the previous year, signaling a shift toward a more disciplined, cooling market.
Global Video Game Deals Report 2020
The 2020 fiscal year marked a historic period of consolidation and capital infusion for the global video game industry, largely catalyzed by the COVID-19 pandemic and the resulting surge in at-home entertainment.
- The global video game industry reached a record $33.6 billion in total deal value across 664 transactions in 2020, driven by pandemic-induced demand for at-home entertainment.
- Public offerings were the largest financial contributor at $15.1 billion, bolstered by high-profile IPOs from Unity Software and Kakao Games alongside corporate debt refinancing.
- Mergers and acquisitions totaled $12.6 billion across 219 deals, with Tencent, Embracer Group, Stillfront, and Zynga accounting for 60% of that value.
Embracer Acquires Tarsier Studios: Investor Presentation
Embracer Group has finalized the acquisition of Tarsier Studios, a Malmö-based developer, to bolster its portfolio of original intellectual properties.
- Embracer Group acquired Tarsier Studios for a total purchase price of SEK 99 million, comprised of SEK 88 million in cash, SEK 11 million in B shares, and a ten-year earnout capped at SEK 44 million.
- Tarsier Studios will operate as an autonomous entity within the Goodbye Kansas Game Invest sub-group, shifting its strategic focus from external work-for-hire to developing and owning original intellectual properties.
- The studio employs over 60 staff members with an average of eight years of industry experience and a track record of developing million-selling titles like Little Nightmares.
Stillfront Group Capital Markets Day 2019
Stillfront Group operates as a decentralized powerhouse within the global free-to-play gaming sector, prioritizing a model that balances entrepreneurial autonomy with centralized operational support.
- Stillfront Group targets 4,000 MSEK in net revenue and a 35% adjusted EBIT margin for the 2020–2022 period.
- The company operates a decentralized model managing 35 live games, utilizing a shared internal infrastructure called Stillbase to facilitate cross-studio data sharing and operational synergies.
- Growth is driven by a dual-strategy of organic expansion through evergreen content updates and disciplined, value-accretive acquisitions such as KIXEYE.
Beyond Games | Surviving Challenges and Launching Battle Strike Force
Beyond Games operates as a distributed mobile studio with approximately 50 employees across San Francisco, South Africa, and El Salvador, focusing on the development of deep social gameplay experiences.
- Beyond Games leverages a strategic partnership with Sylvester Stallone as a recurring mentor character in 'Battle Strike Force' to lower customer acquisition costs and target males aged 35 to 55.
- The studio maintains a lean engineering team of 10 to 12 developers capable of supporting over 30,000 concurrent players by utilizing third-party server engines like Mavryk instead of proprietary infrastructure.
- Operational success is driven by a distributed workforce of approximately 50 employees across San Francisco, South Africa, and El Salvador, focused on deep social mobile gameplay.
Gondola Acquisition by Tilting Point | With CEO Niklas Herriger
The acquisition of Gondola by mobile publisher Tilting Point marks a strategic shift toward integrating advanced machine learning infrastructure into the broader mobile gaming ecosystem.
- Tilting Point acquired Gondola to integrate automated machine learning infrastructure into its mobile publishing ecosystem, shifting focus from aggressive user acquisition to maximizing player lifetime value and retention.
- The merger aims to replace manual, static A/B testing with dynamic, automated systems to overcome industry-wide SDK fatigue and streamline product management workflows.
- Gondola, originally founded in 2013 as an indie studio, transitioned into a B2B provider before the acquisition, highlighting the difficulty of scaling independent B2B infrastructure due to long sales cycles and constant product validation requirements.
Annual General Meeting FY 18/19: Presentation
The 2019 Annual General Meeting presentation outlines the strategic and financial trajectory of Embracer Group, emphasizing a dual-growth model driven by aggressive acquisitions and organic development.
- Embracer Group achieved massive financial scaling in FY 18/19, with net sales increasing 1,033% to 5,754 million SEK and operational EBIT rising 344% to 897 million SEK.
- The company operates a decentralized 'buy-to-build' model across three autonomous sub-groups—THQ Nordic, Deep Silver, and Coffee Stain—supported by 2,208 total employees and contractors.
- As of mid-2019, the group held 2,011 million SEK in net cash, providing the liquidity necessary to sustain its aggressive acquisition strategy for dormant intellectual properties.
THQ Nordic: Embracer Group Investor Presentation
Embracer Group operates as a decentralized parent organization overseeing a vast portfolio of gaming studios, including THQ Nordic, Koch Media, and Warhorse Studios.
- Embracer Group operates as a decentralized parent organization managing a portfolio that includes THQ Nordic, Koch Media, and Warhorse Studios.
- The company maintains a global footprint with operations spanning more than 40 countries across Europe, North America, Africa, and Asia.
- Corporate strategy is defined by four strategic pillars: Business Sense, Solid Work, Great People, and Greener Planet.