Netflix to Acquire Finnish Mobile Game Developer Next Games

Rhea-AI Summary

Netflix (NFLX) announced on March 2, 2022, its agreement to acquire Next Games for approximately €65 million, offering €2.1 per share. Next Games, established in 2013, specializes in mobile games based on popular entertainment franchises, with notable titles like Stranger Things: Puzzle Tales. The acquisition aims to enhance Netflix's gaming portfolio and internal studio capabilities. The Board of Directors of Next Games has unanimously recommended that shareholders accept the tender offer. The deal is expected to close in Q2 2022, pending customary conditions.

Positive

• Acquisition value of approximately €65 million enhances Netflix's gaming portfolio.
• Next Games has a strong track record with popular entertainment franchise-based games.
• Strategic move to expand Netflix's internal game studio capabilities.

Negative

• The acquisition may involve integration challenges impacting operational focus.
• -

LOS GATOS, Calif., March 2, 2022 /PRNewswire/ -- Netflix, Inc. (NASDAQ: NFLX) today announced that it has entered into a combination agreement to acquire Next Games (NXTGMS). Under the terms of the agreement, Netflix will commence a tender offer to acquire all of the issued and outstanding shares of Next Games. Pursuant to the offer, Next Games shareholders will receive €2.1 in cash per share of Next Games, for a total equity value of approximately €65 million. The Board of Directors of Next Games has unanimously decided to recommend that the shareholders accept the tender offer.

"Next Games has a seasoned management team, strong track record with mobile games based on entertainment franchises, and solid operational capabilities," said Michael Verdu, Vice President of Games, Netflix. "We are excited for Next Games to join Netflix as a core studio in a strategic region and key talent market, expanding our internal game studio capabilities. While we're just getting started in games, I am confident that together with Next Games we will be able to build a portfolio of world class games that will delight our members around the world."

Founded in 2013 and led by Teemu Huuhtanen, Next Games creates and operates engaging mobile games with global appeal and an authentic and social fan experience at its core. The company's strategy is to develop games based on popular entertainment IP, such as Stranger Things: Puzzle Tales, a story-driven puzzle role playing game (RPG) inspired by one of Netflix's most watched series. The company had approximately 120 employees at the end of 2021 and reported sales of approximately €27.2 million in 2020, with 95% of revenues generated from in-game purchases.

"We have had an unwavering focus to execute on our vision: to become the partner of choice for global entertainment businesses and craft authentic and long-lasting interactive entertainment based on the world's most beloved franchises," said Teemu Huuhtanen, Chief Executive Officer, Next Games. "Joining forces with the world's largest streaming service, Netflix, presents an opportunity for a logical and exciting continuation of our strategy to craft interactive experiences for the world to enjoy. Our close collaboration with Netflix on Stranger Things: Puzzle Tales has already proven that together we create a strong partnership. This is a unique opportunity to level-up the studio on all fronts and continue on our mission together."

The transaction is expected to close in the second quarter of 2022, subject to customary closing conditions. For more information regarding this transaction please visit www.nextgames.com/investors/netflix-offer.

About Netflix

Netflix is the world's leading streaming entertainment service with 222 million paid memberships in over 190 countries enjoying TV series, documentaries, feature films and mobile games across a wide variety of genres and languages. Members can watch as much as they want, anytime, anywhere, on any Internet-connected screen. Members can play, pause and resume watching, all without commercials or commitments.

About Next Games

Next Games is the first publicly listed mobile game developer and publisher in Finland, specializing in games based on entertainment franchises, such as movies, TV series or books. The developers of the critically acclaimed The Walking Dead games redefine the way franchise entertainment transforms into highly engaging service-based mobile games. Next Games works on multiple new games based on beloved global IP's. The company's latest game, Stranger Things: Puzzle Tales, is based on Netflix's hit 80s horror drama series. www.nextgames.com

 

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SOURCE Netflix, Inc.

FAQ

What is the purpose of Netflix's acquisition of Next Games?

The acquisition aims to enhance Netflix's gaming portfolio and internal game studio capabilities.

What is the value of Netflix's acquisition deal with Next Games?

Netflix is acquiring Next Games for approximately €65 million, offering shareholders €2.1 per share.

When is the acquisition of Next Games expected to close?

The acquisition is expected to close in the second quarter of 2022, subject to customary closing conditions.

How will Next Games contribute to Netflix's gaming strategy?

Next Games specializes in mobile games based on entertainment franchises, which aligns with Netflix's strategy of engaging its audience through interactive entertainment.