£2.1 Billion EQT Bid Accepted by Fortnite Outsourcing Company

Keywords Studios Agrees to EQT Led Buyout at £2.1 Billion Value

Keywords Studios Plc, a prominent player in the video game services industry, has accepted a buyout proposal from a consortium led by EQT AB. The deal values the company at approximately £2.1 billion ($2.5 billion). This agreement, endorsed unanimously by Keywords’ board, comes amid a challenging period as the sector grapples with delayed and canceled orders.

Final Offer at £24.50 Per Share

Under the terms of the agreement, investors will receive £24.50 per share in cash. The offer represents a revised figure after the initial proposal of £25.50 per share was reduced. EQT's decision to lower the offer reflects the current struggles within the gaming industry, largely attributed to repercussions from last year's Hollywood strikes and a reduction in client development projects.

Consortium Members

This acquisition is spearheaded by EQT and includes significant partners such as the Canada Pension Plan Investment Board and Singapore’s state investment company, Temasek Holdings Pte. Despite adjusting the offer, EQT is committed to moving forward, backed by sufficient due diligence results. The consortium plans to conduct a thorough six-month review of Keywords’ operations post-acquisition.

Keywords' Market Position and Future Prospects

Founded in 1998 and listed on the London Stock Exchange’s AIM market in 2013, Keywords Studios has carved a niche by providing development, audio, and art services to major gaming companies like Epic Games Inc. and Activision Blizzard Inc. The company has rapidly expanded its global presence, currently operating in 26 countries, through strategic acquisitions of support studios. Keywords remains optimistic about resuming growth in the latter half of the year, despite recent market uncertainties.

Keywords’ extensive portfolio features well-known game titles such as Fortnite, Call of Duty, and Baldur’s Gate 3. The company's shares saw a 2.8% rise to £23.82 following the announcement of the deal, signaling positive investor response.

Industry Challenges

Keywords Studios had previously warned in its annual report about the significant uncertainties surrounding its recovery pace due to ongoing labor disputes in the industry. Before the deal discussions in May, the company’s shares had dipped more than 10%, reflecting the broader market’s volatility and specific challenges within the gaming sector.

Looking Ahead

This acquisition by EQT and its partners marks a significant shift for Keywords Studios, positioning it for a potentially robust post-recovery period. The comprehensive review expected in the six months following the deal's closure will be crucial in shaping the company's future strategies and operations.

Updates on this story will be provided as more information becomes available.