Gaming Services Provider, Keywords Studios, agrees to £2.1bn takeover led by EQT (with consortium that includes Temasek)

The board of Keywords has accepted an offer of 2,450 pence a share, marking a 67% premium over the company’s closing price of 1,470 pence on 17 May, the last business day before the offer period began.

The deal represents a multiple of approximately 15.9 times Keywords Studios’ adjusted Ebitda for 2023 of £139m.

The consortium, through its bidco, said that it believes “growth can be unlocked, at a greater pace, by expanding into adjacent media and entertainment end-markets and fast-growing technologies”.

It added: “The global gaming services sector is characterised by constant change and innovation, accelerated by the emergence of generative AI. Operating in the private markets, coupled with additional capital, would enable Keywords Studios to invest in innovation that is essential for it to keep up with this pace of change and sustain its status as the global gaming services market leader.”

Founded in 1998 by Giorgio Guastalla and Teresa Luppino, Keywords joined the Aim market in 2013 and has grown its revenue over the past decade from €16.4m in 2013 to €780.4m in 2023, with its software being used in best-selling games such as Fortnite and League of Legends.

Don Robert, chair of Keywords Studios, said: “Whilst the board expects the continued execution of Keywords Studios’ strategic objectives and its leadership position to create significant value, the board is also mindful of the near-term challenges in the broader video games and entertainment industries, as well as other longer-term uncertainties, which have caused volatile returns for Keywords Studios’ shareholders over the past fifteen months.

“On balance, the board believes that this offer represents a good opportunity for Keywords Studios shareholders to realise value for their investment in cash upfront at a significant premium to the undisturbed share price. We therefore unanimously recommend the offer to our shareholders.”

EQT will deploy its capital through BPEA Fund VIII, which is part of EQT Private Capital Asia’s flagship private equity investment strategy focused on large-cap buyouts.