EQT Group in advanced talks to acquire Keywords Studios for £2.2 billion

Keywords Studios, a prominent player in the video game and entertainment industry, has confirmed it is in advanced discussions with private equity firm EQT regarding a potential acquisition. This significant development, reported by the Financial Times, values Keywords Studios at approximately £2.2 billion, with EQT negotiating a cash offer of £25.5 per share.

The news marks a pivotal moment for Keywords Studios, which has become a cornerstone in the video game services sector. In a statement issued earlier today, the company revealed that EQT had previously made four unsolicited proposals, all of which were rejected. However, the current offer represents a “significant increase” over previous bids, prompting Keywords’ board to consider recommending it to shareholders.

Despite the advanced stage of negotiations, Keywords’ shareholders have been advised to refrain from taking any action until a formal offer is made. EQT Group has until June 15 to finalize its proposal. Keywords’ board emphasized their confidence in the company’s strategic growth plan, which involves building a comprehensive global platform for video game and entertainment solutions. They also noted that EQT is supportive of this strategy, which has driven Keywords’ expansion both organically and through acquisitions.

Keywords Studios has significantly broadened its service offerings in recent years through a series of strategic acquisitions. The most recent addition to its portfolio was The Multiplayer Group, acquired from Improbable for £76.5 million. This acquisition underscores Keywords’ commitment to enhancing its capabilities and expanding its global footprint.

Currently, Keywords Studios operates over 70 facilities worldwide, providing a wide range of services including quality assurance, localization, art, audio, marketing, and game development. This extensive service network has positioned Keywords as a critical partner for many leading video game developers and publishers.

The potential acquisition by EQT reflects the growing interest in the video game industry from private equity firms. With its robust growth trajectory and comprehensive service offerings, Keywords Studios represents a valuable asset in the evolving landscape of digital entertainment. As the industry continues to expand, the integration of Keywords’ extensive service network with EQT’s financial backing could further accelerate the company’s growth and innovation in the sector.