Keywords Studios snaps up UK game development company for £26m

20 Aug 2018

A still image from the video game ‘For Honor’, which Gobo has worked on. Image: Keywords Studios

Irish video game firm Keywords Studios acquires Gobo in multimillion-euro deal.

After reporting stellar earnings only a few weeks ago, Dublin-headquartered games services firm Keywords Studios has made another major acquisition. The latest deal is the eighth transaction for the company in 2018, marking a very busy year.

Keywords has acquired Studio Gobo and Electric Square (Gobo, collectively) for a total consideration of up to £26m (€29m).

Gobo provides a range of games development services to both publishers and developers around the world. Its studios are based across three locations in Brighton and Hove in the UK.

Expanding talent pool for Keywords Studios

Gobo employs 170 artists, software engineers, animators, game designers, quality assurance testers and producers. It works to deliver services such as full game development from concept to completion, co-development with client teams, live operations involving new features and downloadable packages, and porting services for games to run on different platforms.

Gobo has worked on some major titles, such as Disney Infinity, Ubisoft’s For Honor and the newest racing game from Microsoft, Miami Street. The acquisition adds more expertise and scale to Keywords’ growing games development business. The total UK games development team at Keywords now stands at 220.

The nitty-gritty

Under the terms of the acquisition, Keywords is paying a total consideration of up to £26m. The initial consideration is £10.5m in cash and 254,529 new ordinary shares in Keywords, which will be issued on the anniversary of completion. These will then be subject to orderly market provisions for a further 12 months.

The remaining consideration of £11m is payable in a mix of cash and shares, or all in cash at the discretion of Keywords. This is subject to the achievement of a substantial increase in Gobo’s EBITDA (earnings before depreciation, interest, taxes and amortisation) over the 12-month period following completion.

 Andrew Day, CEO of Keywords Studios, commented: “By significantly enhancing our game development services in both scale and expertise, these studios together with recently acquired Snowed In, Sperasoft, D3t and GameSim help position Keywords as a go-to game development partner, and give us ever greater visibility of games in the pipeline, at the outset of their development.”

Tony Beckwith, CEO of Gobo, added: “As we look to build upon our strong foundations, Keywords’ leading position in the video games industry, its breadth of services and its geographical reach will provide us with a strong and broader platform from which to deliver our ambitious growth plans.”

Ellen Tannam was a journalist with Silicon Republic, covering all manner of business and tech subjects