European private equity firm EQT is on the brink of acquiring Keywords Studios, a Dublin-based video game services company, for a staggering $2.8 billion. The advanced talks between the two entities signify a significant development in the realm of video game industry mergers and acquisitions.
According to a joint statement released by EQT and Keywords Studios, the negotiations revolve around a potential cash offer of £25.50 per share for Keywords, which is listed on the London Stock Exchange. This offer represents a remarkable 73% premium over Keywords’ closing share price of £14.70 on Friday, underscoring EQT’s eagerness to seal the deal.
Interestingly, EQT had previously submitted four unsolicited proposals to Keywords, all of which were turned down by the latter’s board. However, the current offer significantly surpasses EQT’s initial bids, indicating a willingness to sweeten the deal and entice Keywords into an agreement.
After careful deliberation with its financial advisors, Keywords Studios’ board has signaled its inclination to recommend the proposal to the company’s shareholders. This decision underscores the board’s confidence in EQT’s offer and its potential to deliver value to Keywords’ stakeholders.
Nevertheless, under Britain’s stringent takeover regulations, EQT faces a deadline of June 15 to formalize its offer or withdraw from the negotiations. This deadline adds a sense of urgency to the ongoing discussions, compelling EQT to expedite its decision-making process.
Established in 1998, Keywords Studios has emerged as a global leader in providing creative and technology-enabled solutions to the video game and entertainment industries. With over 70 facilities spanning across 26 countries, Keywords has established a formidable presence in the gaming sector, making it an attractive target for acquisition.
As the negotiations between EQT and Keywords Studios near their conclusion, industry observers await the final outcome, anticipating the potential ramifications for both companies and the broader video game ecosystem. If successful, the acquisition could reshape the competitive landscape of the gaming industry, paving the way for new opportunities and synergies between the two entities.
