A DUNDEE-based games development business has been sold to stock market listed online gambling technology firm Playtech in a deal worth up to £14 million.
YoYo Games was founded in 2007 by Aberdeen University psychology graduate and gaming enthusiast Sandy Duncan after a career which including 17 years at Microsoft where he launched the Xbox in Europe.
He is thought to own a stake of just under half the company which will see him in line to receive around £4.5m under the sale.
YoYo’s main product is the “Game Maker: Studio” that enables developers to create games using a single programming code and then publish them to run across most common platforms including Android, PlayStation, Xbox and Windows 8.
The platform has secured more than 750,000 registered games developers who currently use the platform on a free basis with chargeable add-ons. On top of the £10.6m intial sum being paid for the acquisition, which will be funded from Playtech’s existing cash balances, an earn-out consideration and a retention plan is expected to add a further £3.4m to the deal value.
Isle of Man-based Playtech, the world’s largest online gaming software supplier traded on the London Stock Exchange’s main market, said the acquisition of YoYo was part of the company’s strategy to “penetrate the casual gaming space”.
“Playtech’s directors believe that the continued development of the ‘Game Maker: Studio’ technology within the company will enable it to extend beyond the current games developers base,” it said in a statement.
“This acquisition will enable the company to further diversify its business, benefiting from a combined B2B/B2C offering focused on a strong and growing segment of the wider gaming market.”
Prior to founding YoYo Games with a number of other industry executives, Duncan was the vice-president and managing director for Europe at Lexar Media for which he established a distribution network and branch offices in six countries.
Last year, YoYo Games announced plans to double its 25-strong workforce after expanding into new offices on the top floor of the DundeeOne development in the heart of the Dundee Waterfront regeneration area.
The company had established its European headquarters in Dundee in May 2010 by opening an office within Abertay University with just two team members.
In a trading update last month, Playtech said it continued to trade well in the fourth quarter.
The FTSE 250-listed company said it expects revenue and adjusted earnings before income, taxation, depreciation and amortisation to be “comfortably” in line with market estimates which would mean double-digit growth for the year in both earnings and revenue.
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