Sweden’s Modern Times Group (MTG) has raised its shares in InnoGames to 51 per cent, a press release said Tuesday. MTG announced its initial 21 per cent investment in InnoGames last October. MTG has invested EUR 82.6 million for the additional shares, based on the same enterprise value of EUR 260 million for 100 per cent of the business as for the original investment. MTG will fully consolidate InnoGames effective from May, 1 2017.
Growing market for digital games
InnoGames has generated compound annual revenue growth of more than 20 per cent since 2014 and 25 per cent growth in 2016 to EUR 130 million. The acceleration is being driven by the mobile gaming segment, with over half of all new InnoGames user registrations on mobile platforms. Several new mobile-only titles are presently in development. InnoGames reported an EBITDA margin of approximately 20 per cent and an EBIT margin of around 16 per cent in 2016. Jørgen Madsen Lindemann, MTG President and CEO, said: “Revenues in the global gaming industry are expected to reach USD 113 billion by 2018, and mobile and PC games represent 45 per cent of this and are the fastest growing segment. InnoGames is a great business with great products, and is already performing above our expectations when we made our original investment. We have got to know the talented InnoGames team very well over the past six months and are impressed with the strategy, culture, performance and management of the business.”
Company aiming for bigger global audience
Hendrik Klindworth, InnoGames CEO: “The next chapter of the InnoGames story starts today. We established InnoGames to make great games that people want to play for decades, and we have already created six games played by millions of gamers every single day. With MTG on board, we will keep our entrepreneurial spirit and unique culture, while bringing our new games to an even bigger global audience.” Arnd Benninghoff, MTG EVP and MTGx CEO: “Gaming will become an increasingly important area for us as it is one of the fastest growing forms of digital entertainment and complements our esports and MPN businesses. InnoGames is the first step in the development of this third digital vertical for MTGx and is an excellent fit with our strategy to become a global digital entertainer. We look forward to building an even more successful company together. “