Sweden’s Modern Times Group (MTG AB) is obtaining a 35 per cent share of the Hamburg-based InnoGames based and from the former investor, Eight Roads Ventures based on a corporate value of EUR 260 million for 100 per cent of the company, InnoGames announced Thursday (October 13th, 2016). MTG has an option to obtain another 16 per cent of the company at the same valuation. The deal is subject to German and Austrian merger approvals.
esports mass market
The investment is part of MTG’s digital strategy and creates a third digital entertainment vertical for MTGx in addition to its esports and MPN businesses. Jørgen Madsen Lindemann, MTG President and CEO, said: “We have been involved in the gaming space for a while now, and look for companies with clear track records in IP development that have translated into high revenue growth and a healthy profitability profile over time. This we have found with InnoGames.”
Esports/gaming is one of the largest and fastest growing online content categories. More people watched esports/gaming online than traditional sports during the second quarter of 2016, a recent industry report in Sweden has found.
Gaming market growing
Revenues in the gaming industry are expected to grow at a compound rate of 7 per cent from 2015 to 2018 to a total of USD 113 billion of which USD 51 billion is expected to come from browser and mobile based gaming, according to InnoGames. Mobile based games is the fastest growing segment, with an anticipated compound growth rate of 12 per cent during the same period driven by larger audiences, more paying players, and increasing average spend per player. Hendrik Klindworth, CEO of InnoGames, noted: “MTG’s international presence, understanding of storytelling entertainment, and commitment to IP development and building engaged user communities will bring our games to even larger audiences around the world.”
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