Games developer gears up for £145m float
A Sheffield-based games developer has announced its intention to float in a listing which values the business at £145m.
Sumo Digital’s initial public offering (IPO) was priced at 100 pence per share for listing on London’s junior market on Wednesday.
Sumo, one of the UK’s largest providers of creative and development services to the video games and entertainment industries, said the placing of ordinary shares has raised around £38.5m, while a vendor placing has raised about £39.7m for selling shareholders.
The deal sees the company’s owner, Perwyn, retain a substantial shareholding of the company on admission. The private equity house has been the majority shareholder at the firm since September 2016, following a secondary buyout from NorthEdge Capital.
Founded in 2003, the business employs more than 450 across its headquarters in Sheffield, Nottingham and Pune, India.
Carl Cavers, founder of Sumo Digital and CEO, said: “We are delighted to announce our intention to float on AIM. This is a significant step forward in Sumo’s journey to become a global leader in premium development and creative services to the video game and wider entertainment industries. We have had an overwhelmingly positive response to the IPO, which has been very well supported by blue chip institutional investors.
“Our people are our business; we believe our teams are very well positioned to lead the way in one of the world’s most exciting creative industries. Being a quoted company in a fast-growing tech sector will, we believe, allow us to execute our strategy, whilst continuing to put quality and creativity at the forefront of the products and services we deliver.”
Sumo Digital is known for titles such as Snake Pass and the Sonic & Sega All-Stars Racing franchise.
Earlier this year the company acquired art and design studio Atomhawk, which was founded in 2009 and works on blockbuster movies and games across PC, console and virtual reality platforms: including Marvel Studios’ ‘Guardians of the Galaxy’ and games ‘Injustice 2’ and ‘Eve: Valkyrie’.
Investment bank Zeus Capital has acted as nominated adviser.
Richard Darlington, director of corporate finance at Zeus Capital, said: “Sumo Group has shown an ability to offer a full end to end service in a rapidly growing marketplace, investing heavily in its leading technology and creative solutions to produce high quality output for its blue chip customer base. As a result, the company is ideally placed to thrive on AIM, and is well positioned to benefit from the growth in demand.
“This has been another outstanding Northern deal for the Zeus Capital team, following similar recent successes on Tatton and Strix. As a result, the firm is ranked second by funds raised on AIM in 2017, building on our strong track record on the market in recent years. Our transactions this year have shown that there is significant opportunity for growth following a listing, and we look forward to working with Carl and the team to unlock this in the coming months.”
Grant Thornton and Addleshaw Goddard provided advisory services to Sumo Digital, while Zeus Capital was advised by Eversheds on the transaction.
The 70 person AG team comprised lawyers from the firm’s Manchester and Leeds offices, and was led by partner Roger Hart and included Jamie Partridge, Rachael Norris, Ben Collins, Shannon Hardcastle, Millie Johnson, George Danczak, David Handy, Kate McGough, Tom Rowen, James Whittam, Lauren Wills-Dixon, Andrew Vernon and Tom Ward.
