EG7 Acquires Big Blue Bubble For Up To $58m

💵 Acquisition

• Stockholm-based developer and publisher of PC, console, mobile games Enad Global 7 AB (ST: EG7) has entered an agreement to acquire 100% of the Canadian mobile game developer Big Blue Bubble for total purchase price of up to $58m

• The total consideration of $58m on a cash- and debt- free basis includes:

  • $12.2m — upfront consideration with 53% paid in cash and 47% in stock

  • up to $45.8m — earn-out consideration with up to 33.3% paid in newly issued shares and rest — in cash

  • Earn-out is payable subject to Big Blue Bubble’s financial performance (up to 3x EBIT) during the fiscal years 2020 and 2021

• The deal completion is subject to customary conditions and is expected to close during the fourth calendar quarter of 2020. Big Blue Bubble will stay as a separate entity and would operate independently from EG7

• Big Blue Bubble generated $9.2m LTM Revenue and $2.7m LTM EBITDA for the period ended June 30, 2020

🧩 Previous Acquisitions EG7

• In December 2019, EG7 acquired Sold Out Sales & Marketing Limited, a London-based video game publisher and distributor of PC/console games, for a total consideration of $26.9m, including:

  • upfront consideration of $15.2m in cash and $5.1m in stock

  • earn-out consideration of $6.6m

• In June 2019, EG7 acquired 100% of shares in British game development FPS-focused studio Antimatter Games for around $170k with $400k cash balance

• In June 2019, EG7 acquired 100% of US-based creative marketing agency Petrol Advertising for up to $23m

  • upfront consideration of $18m was paid in $10.75m of cash and $7.25m of shares

  • earn-out consideration of $5m

• In June 2018, EG7 acquired Norwegian game development studio ARTPLANT AS for up to $120k upfront, with an earn-out consideration of 465,323 shares

🎲 Products

• Big Blue Bubble is an industry veteran with portfolio of over 100 titles, based both on its own IPs and with IPs of Disney, DreamWorks, Scholastic, and Nickelodeon and others

• The studio’s My Singing Monsters IP has generated over $76.3m over its existence

• The studio has been a top grosser within the music genre of F2P games for more than 5 years

• The deal lines up with EG7 strategy of strengthening its position within the industry through complimentary acquisitions. Additionally, it would bring variety to its business model with recurring revenues from Big Blue Bubble’s IP’s

• The deal is beneficial to both parties as:

  • Big Blue Bubble can bring its knowledge of mobile and casual game market

  • EG7 can provide its publishing, marketing and development capabilities

SOURCES: ENADGLOBAL7