Jam City will go public through SPAC at $1.2B valuation

Jam City, the developer behind mobile game Harry Potter: Hogwarts Mystery and Cookie Jam has agreed to go public through a special purpose acquisition company. The combined company will have a valuation of $1.2 billion.

As part of the transaction, Jam City will acquire Montreal-based mobile game publisher Ludia for $175 million, in order to “bring together two highly creative leaders in mobile gaming and further strengthen Jam City’s market position and global player network.” 

“We expect going public will provide us with a source of capital to accelerate our growth and advance our strategic priorities, while acquiring and teaming up with Ludia adds compelling new intellectual property and gaming genres to our catalog. Together, we believe these transactions will advance our vision to create premium, social mobile games that are an enduring part of our players’ lives.” said Chris DeWolfe, Chairman and Chief Executive Officer of Jam City.

Upon closing, the combined company will operate as Jam City Holdings, Inc. and its Class A common stock will be listed on the New York Stock Exchange under the ticker symbol “JAM”.

The existing Jam City shareholders will own approximately 65% of the merged company’s Class A common stock, assuming no redemption by DPCM Capital shareholders. Netmarble, as an existing strategic investor of Jam City, will own a significant portion of the combined company, the company said in a statement. 

“We believe Jam City is at the forefront of mobile gaming, and its unique Games-as-a-Service model has proven to sustain player retention and drive monetization,” said Emil Michael, Chairman and CEO of DPCM Capital. “We are proud to partner with Chris, Josh and the team in their efforts to continue Jam City’s growth and further define the company as a category-defining entertainment brand.”

The deal marks the ongoing financial boom in the gaming industry. Dealmaking activity in the video games industry reached $25 billion total deal value across 249 transactions in the first quarter of 2021, up 2x as compared to the first half of 2020FY. 

While M&As accounted for 57% of the total deal value of Q1’21 with $14.3B, public offerings demonstrated a “stunning” deal value of $8.3 billion, up 29X YoY growth with 3x number of closed transactions.