Netflix has entered into a combination agreement to acquire Next Games. Under the terms of the agreement, Netflix will commence a tender offer to acquire all of the issued and outstanding shares of Next Games. Pursuant to the offer, Next Games shareholders will receive $2.32 in cash per share of Next Games, for a total equity value of approximately $71 million. The board of directors of Next Games has unanimously decided to recommend that the shareholders accept the tender offer.
“Next Games has a seasoned management team, strong track record with mobile games based on entertainment franchises, and solid operational capabilities. We are excited for Next Games to join Netflix as a core studio in a strategic region and key talent market, expanding our internal game studio capabilities. While we’re just getting started in games, I am confident that together with Next Games we will be able to build a portfolio of world class games that will delight our members around the world,” said Netflix VP of games Michael Verdu.
Founded in 2013 and led by Teemu Huuhtanen, Next Games creates and operates engaging mobile games with global appeal and an authentic and social fan experience at its core. The company’s strategy is to develop games based on popular entertainment IP, such as Stranger Things: Puzzle Tales, a story-driven puzzle role playing game (RPG) inspired by one of Netflix’s most watched series. The company had approximately 120 employees at the end of 2021 and reported sales of approximately $29.9 million in 2020, with 95 per cent of revenues generated from in-game purchases.
“We have had an unwavering focus to execute on our vision: to become the partner of choice for global entertainment businesses and craft authentic and long-lasting interactive entertainment based on the world’s most beloved franchises. Joining forces with the world’s largest streaming service, Netflix, presents an opportunity for a logical and exciting continuation of our strategy to craft interactive experiences for the world to enjoy. Our close collaboration with Netflix on Stranger Things: Puzzle Tales has already proven that together we create a strong partnership. This is a unique opportunity to level-up the studio on all fronts and continue on our mission together,” said Next Games CEO Teemu Huuhtanen.
The transaction is expected to close in the second quarter of 2022, subject to customary closing conditions.
