Gaming heavyweight levels up with multi-million pound takeover
GAMING heavyweight Sumo Digital, has been bought by private investment firm Perwyn in a deal worth “multi-millions”. The Sheffield-based video game developer, which is behind Little Big Planet 3 Disney Infinity, Dead Island 2, and Sonic & All Stars Racing, had been sold by NorthEdge Capital, the Manchester-based private equity business.
In 2014, NorthEdge helped the management team acquire the business in a buyout from Foundation 9 Entertainment, the US entertainment media company which acquired Sumo in 2007.
The Sumo Digital group turned over £21.6m last year, with pre-tax profits of £1.7m. It said it was “well-placed” to take advantage of the new console platforms launched by Microsoft and Sony, and has recently opened up a new Nottingham office. During the past to years, the business has increased staff numbers by 110 to 350.
Carl Cavers, CEO at Sumo Digital, said: “NorthEdge has been an excellent partner for Sumo, supporting the business with both capital and expertise to help us achieve our growth ambitions.
“The launch of our new Nottingham studio has enabled us to attract some world class talent and the investment into our India operation has broadened the expertise of the local team to include software engineering as well as art content.
“Our people are at the core of everything we do at Sumo and with major projects such as Crackdown 3 and Dead Island 2 under way, it is an exciting time for us. We operate in a high growth, global market and the pace of technological development and the changing ways in which users consume video games present a great opportunity for the business.”
Screenshot from Sumo Digital’s Snake Pass game
Andrew Wynn, partner at Perwyn, commented: “Perwyn is delighted to be partnering with Sumo and its exceptional management team led by co-founder Carl Cavers, to support the next stage in its growth. We believe there are significant opportunities ahead for Sumo as a leading independent games developer in a growing, global market place including the potential to apply the team’s substantial creative and technical capabilities to new titles and IP development. “
The corporate finance team at KPMG advised North Edge on the deal, with legal advice provided by Addleshaw Goddard and Sheridans.
PwC provided financial and commercial due diligence and Perwyn was advised by PwC and Ashfords. Senior debt was provided by Yorkshire Bank’s specialist and acquisition finance team.
