Drake Star expects a new wave of gaming M&A activity throughout the remainder of 2025 and 2026, with IPO activity “likely to pick up,” according to the technology investment bank’s latest Global Gaming Report.
“Private equity participation in the gaming ecosystem is expected to remain very active, with some publicly traded gaming companies potentially being taken private and PE firms taking growth equity positions in large private gaming companies,” the report said.
Gaming M&A remained relatively stable in the second quarter with 46 announced deals, according to the report.
Starting with the most recent, PE Hub rounded up five notable PE-backed deals in the gaming industry.
1. CVC makes investment in mobile game company Dream Games
In May, CVC made a strategic investment in Dream Games, the developer and publisher of mobile games Royal Match and Royal Kingdom.
CVC will be the company’s sole equity partner.
Dream Games was founded in 2019 by mobile game industry veterans Soner Aydemir, Ikbal Namli, Hakan Saglam, Eren Sengul and Serdar Yilmaz. It has offices in Istanbul and London.
2. Investor group backs acquisition of Ludia from Jam City
In March, Ludia, a video game studio, was acquired by local shareholders and members of its senior management team from Jam City.
Fonds de solidarité FTQ, Investissement Québec (IQ), BDC Capital Growth Equity Partners, Export Development Canada (EDC) and Groupe W invested in the deal. Additional support was provided by National Bank of Canada.
Founded in 2007, Montreal-based Ludia has developed more than 50 games based on popular franchises and original licenses. Since inception, the studio has generated more than C$1.3 billion ($949 million; €813 million) in revenue, with more than 500 million downloads, and attracts over 3.5 million players each month, according to a statement.
3. Game developer Saber Interactive picks up investment from Aleph and Crestview
Aleph Capital Partners and Crestview Partners in September made a significant equity investment in Saber Interactive, a Fort Lauderdale, Florida-based interactive entertainment and video game developer.
4. EQT agrees £2.1bn deal for video games biz Keywords Studios
EQT, CPP Investments and Temasek agreed to acquire Keywords Studios in 2024 in a transaction that valued the entire issued and to be issued ordinary share capital of the company at around £2.1 billion ($2.7 billion; €2.5 billion) on a fully diluted basis.
The acquisition implies an enterprise value of around £2.2 billion and a multiple of around 15.9 times Keywords Studios’ adjusted EBITDA of £139 million for the 12-month period ended 31 December 2023.
Dublin-based Keywords Studios is a global creative and technology-enabled service provider to the video games and entertainment industries. It has more than 70 facilities in 26 countries located in Asia, Australia, US and Europe.
5. Carlyle hands Jagex controller to CVC and Haveli
A few months prior, Carlyle Group agreed to sell UK video game developer and publisher Jagex to CVC Capital Partners and Haveli Investments after a three-year holding period.
The deal has an enterprise value of £910 million (€1.1 billion; $1.2 billion), according to sources close to the matter.
Jagex is behind the RuneScape series, a collection of massively multiplayer online role-playing games. The series has been around for more than 20 years and has 2.4 million active subscribers and one million free-to-play users, according to a release.
“Gaming has a lot of applications outside of purely just staring at a screen with a controller or keyboard,” Andrew Tan, principal in the Carlyle Europe Technology Partners (CETP) investment advisory team, told PE Hub. “It’s not just a singular activity, it’s an activity which people take part in communities, and they make friends online and they try to have other types of user experiences outside of just the screen. There’s going to be a lot of innovation in this space.
“Ten to 20 years ago, it was always seen as a preserve of teenage boys and quite a niche. Gaming is now global.”
PE Hub expects more deals in the gaming sector in 2025.
