Keywords Studios, the international technical and creative services provider to the global video games industry, today announces that it has acquired the entire issued share capital of Climax Studios, a UK based provider of game development services to the video games industry, for a total consideration of up to £43m. The acquisition will bring significant additional scale to the Group's largest service line, Game Development, and further the Group's strategy to become the 'go to' technical and creative services platform for the global video games industry.
Founded in 1988 and based in Portsmouth, Climax is one of the longest established game development businesses in the UK. The studio's talented team of 109 staff, led by CEO Simon Gardner, provides full game development, co-development, porting and technical consulting services to some of the world's largest games publishers including Sony, Microsoft, 2K, Codemasters and Electronic Arts. Climax has worked on original games and co-development projects across all genres and platforms, including on recent titles such as Silent Hill: Shattered Memories, Crackdown 3 and Returnal PS5.
In recent years, Climax has grown impressively: it recorded an adjusted EBITDA of c.£4.3m in the year ended 31 December 2020 and growth has continued in the current financial year. Under the terms of the acquisition, Keywords will pay a maximum consideration of up to £43m, comprised of an initial consideration of £20.2m in cash and the equivalent of £6.8m in new ordinary shares. Deferred consideration of up to £16m, in a mix of cash and new ordinary shares, will be payable based on growth targets being met over the year following completion. The new ordinary shares to be issued as part of the initial consideration and the deferred consideration are subject to one-year lock-in periods and orderly market provisions for a further period.
 The vendors were Hyperion Capital Limited (82.5%), Simon Gardner (15%) and James Sharman (2.5%).
Jon Hauck, Joint Interim CEO of Keywords Studios, commented:
"We are delighted that Simon and the highly talented Climax team are joining the Keywords family. Climax brings a wealth of expertise, adds significant scale to our rapidly growing Game Development Service Line, and provides access to a new pool of talent from its base in Portsmouth.
"The studio's excellent track record of high quality delivery spans over 30 years, with its services in high demand from some of the largest names in the industry. We are very excited about the experience and opportunities that Climax will bring to Keywords, and our clients, and we look forward to enabling their continued growth as part of the Group."
Simon Gardner (Climax CEO) further commented:
"We are very excited about joining Keywords and the opportunities that being part of an industry leading global business will open up to our clients and our team.
"Keywords Studios shares our growth ambitions and their investment will support the delivery of a wider range of top quality services and products to our clients. We are looking forward to working closely with everyone at Keywords and to start playing our part in the impressive journey of the wider business."