Keywords Studios - Rounding-off the year with an M&A flurry
Adding to Keywords’ US$50m acquisition of High Voltage Software earlier in the week, it has announced a further two smaller acquisitions: Indigo Pearl, a UK PR agency specialising in the video games sector, and Jinglebell, a Milan-based studio that provides audio recording, music production and sound design for video games and advertising. Keywords is to pay up to £2m for Indigo Pearl, 1.1x FY20e revenues and 7.1x FY20e adjusted EBITDA, and up to €1.8m for Jinglebell, equating to 0.9x FY20e revenues and c 18x FY20e EBITDA. This takes Keywords’ tally to seven M&A deals this year, with six in H220. With substantial net cash and €100m of undrawn facilities, we see no reason for the company’s deal making to slow in FY21.Keywords Studios is a technical services provider to the video games industry. Co.'s segments include: Localization Services, which relate to translation and cultural adaptation of in-game text and audio scripts; Localization Testing, which includes testing of linguistic correctness and cultural acceptability of computer games; Audio/Voiceover Services, which relate to audio production process for computer games; Functional Testing, which relates to quality assurance services provided to game producers; Art Creation Services, which relate to the production of graphical art assets for inclusion in the video game; and Customer Support, which relates to the live operations support services.
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