Team 17 enters AIM with £217m valuation

Wakefield-headquartered games development firm, Team 17, started trading on the Alternative Investment Market (AIM) of the London Stock Exchange at 8am today with a valuation of £217m.

The initial public offering (IPO) included £107.5m fundraising and the firm will trade under the ticker TM17. On admission, the company has 131m Ordinary Shares in issue.

Team17 is a leading video games label and creative partner for indie developers. The group supports both owned first party IP and third party IP – through partnering with indie developers globally – in the development and publishing of games across multiple platforms typically for a fixed revenue share.

The Group focuses on premium, rather than free to play games, and its portfolio comprises over 90 games, including the iconic and well-established Worms franchise, as well as Overcooked and The Escapists.

The fundraising, which was multiple times oversubscribed, raised approximately £107.5m, before expenses, through the issue of 27m new Ordinary Shares and the sale of 37m existing Ordinary Shares by existing shareholders at 165 pence per share (the “Issue Price”).

Debbie Bestwick, the company’s chief executive, will retain a 22.2% stake in the company, while private equity firm LDC will retain a shareholding of 16.6% of the shares in issue following admission.

On admission, management and employees will hold approximately 31.2% of the issued share capital of the company.  The group posted revenues of £29.6m for the year ended 31 December 2017, having more than doubled since 2015.

Team 17 said: “The Directors believe that the IPO will enable the Company to continue to invest in its future expansion, retain its independence, enhance its profile and provide the ability to incentivise current and future employees.”

Bestwick said: “We are delighted to have received such strong support from investors.  Our listing on AIM represents a major endorsement of both our business and our people and we believe that our quoted status provides an ideal platform from which to accelerate our growth ambitions.

“We have established a truly exceptional team and our vast expertise within the gaming sector has enabled us to create a market-leading offering.  We are excited by the benefits of being a quoted company and we look forward to further developing our business over the coming years.”

The Team17 float is the latest development in a growing UK games industry. Overall, the combined UK physical and digital sales of video games hit a record £3.5bn last year, an increase of 9.6%. Digital games sales grew 12% to £2.6bn. According to the games industry trade body Ukie, there were 2,175 active games companies in the UK last summer.

The value of the UK games market is almost equal to that of the music and video markets combined – £1.1bn and £2.5bn respectively – despite the rise in popularity of digital services such as Spotify, Netflix and Amazon.

Berenberg is acting as Sole Global Coordinator and Broker and GCA Altium as Nominated Adviser to the company. Squire Patton Boggs also advised Team 17.

The GCA Altium team was led by CEO Phil Adams, and included Adrian Reed, Paul Lines, Jon Stead, Matthew Furness and Hamzah Shakoor, all based in the firm’s Manchester office.

Phil Adams, CEO at GCA Altium, said: “Team17 has a truly impressive growth story, with a clear point of difference in the market. The group has demonstrated the ability to innovate, with the successful development of its games label model together with its own IP resulting in considerable revenue growth.

“The UK games industry is growing at a significant rate, with digital games hitting a record £1.6bn sales last year. Team17 is well positioned as a premium label and developer in the indie gaming market and we are sure will continue to prosper as a public company.”

The Squire Patton Boggs team advising Team17 was led by partner Adam Hastings and senior associate Hannah Crosland. The lead transaction team also included partners Paul Mann (Corporate) and Mark Simpson (Tax) and Corporate associates Joshua Headley and Nathan Bentley.

Hastings said: “Team17 is an ambitious and fast growing business, and we are delighted to have assisted with its successful IPO and admission to AIM, which will provide a launchpad for further growth. It was a pleasure to have worked alongside Debbie and Paul and the rest of the Team17 management team, and we look forward to a building on that relationship as the business continues to expand.”

Click here to sign up to receive our new South West business news...
Close