Keywords Studios acquires UK-based Climax Studios for up to £43m

Latest acquisition will further Keywords’ strategy

Video games services provider Keywords Studios has acquired UK-based Climax Studios for up to £43 million.

The price includes an initial consideration of £20.2 million in cash and the equivalent of £6.8 million in new ordinary shares, with a deferred consideration of up to £16 million, in a mix of cash and new ordinary shares, payable based on targets being met over the year following completion.

The deal is part of the group’s strategy to become the major technical and creative services platform for the industry, and will bring significant additional scale to Keywords Studios’ game development service line.

Founded in 1988 Climax Studios provides game development services to the video games industry, employing 109 staff. The company has provided full game development, co-development, porting and technical consulting services to major games publishers including Sony, Microsoft, 2K, Codemasters and Electronic Arts. Among its recent titles are Silent Hill: Shattered Memories, Crackdown 3 and Returnal PS5.

‘Wealth of expertise’

In the year ended December 31st, 2020, the company recorded adjusted earnings before interest, tax, depreciation and amortisation of £4.3 million, and has experienced further growth in the current financial year.

"Climax brings a wealth of expertise, adds significant scale to our rapidly growing Game Development Service Line, and provides access to a new pool of talent from its base in Portsmouth," Jon Hauck, joint interim chief executive of Keywords Studios.

“The studio’s excellent track record of high quality delivery spans over 30 years, with its services in high demand from some of the largest names in the industry. We are very excited about the experience and opportunities that Climax will bring to Keywords, and our clients, and we look forward to enabling their continued growth as part of the group.

Climax chief executive Simon Gardner said the acquisition would open up opportunities to the company's clients and team.

“Keywords Studios shares our growth ambitions and their investment will support the delivery of a wider range of top quality services and products to our clients,” he said.