[Axios] Predictive Report: Game industry investment, deals to increase in 2024 - Sony, Take-Two and Savvy/Scopely expected to make big purchases

[Gizmo_Duck]

Next year is going to be interesting…

Mergers and acquisitions in the games industry are picking up after "an extended quiet period," according to a new third-quarter report from Drake Star Partners.

Why it matters: Consolidation will make gaming's giants even bigger.

• But it also brings the risk of further job cuts in an industry racked by layoffs this year.

Details: Drake Star tracked 33 M&A deals worth around $5 billion between July and September.

• By the sheer number of deals, that was a two-year low. But the deal value exceeded three of the last five quarters, when all the deals tallied in each period totaled less than $1 billion.
• M&A deals for 2023's third quarter included mobile gaming firm Playtika's purchase of Youda Games and Innplay Labs for around $450 million as well as the successful $1.7 billion offer led by Goldman Sachs to take educational gaming platform Kahoot private.
• Drake Star also counted nearly $1 billion in private investment for the quarter, up from the spring. Investments were primarily in PC, console or blockchain companies.

What they're saying: "Based on our discussions with many of the top gaming companies in the last weeks, we expect the deal volume to increase steadily over the next year," Drake Star partner Michael Metzger tells Axios.

• Metzger anticipates Tencent, Sony, Take-Two and Savvy/Scopely will be the most active buyers in 2024, while the Embracer Group is expected to divest more studios.
• Public companies, including Nintendo, EA and Nexon, are sitting on $45 billion in cash and cash equivalents, setting up the potential for more M&A, according to venture capital firm Konvoy Ventures.

Yes, but: It's been a year of panic for industry pros, who have despaired over job cuts and lessening investment.

• That bleak climate has come despite expectations by analysts that the gaming industry is returning to growth following a post-lockdown correction.

 

[MeachTheMonster]

Consolidation

sony gone fukk up the industry

 

[gurf]

Consolidation

sony gone fukk up the industry

and Take-Two, Tencent, Microsoft, etc. I guess we'll see where this takes us. As long as we don't have 6 gaming streaming services I'm good.

 

[CarltonJunior]

This goes back to what somebody was saying...I think it was @42 Monks about how the development costs are starting to exceed revenue and studios are trying to get bought out of it so they can bow out of the game.

The new gaming landscape isn't kind to AA games so to make it you need to either be aligned with a company that's big business producing AAA games or you need to downsize to indie and not put many resources into your game at all and hope you go viral or make big profits off of a relatively small budget investment.

It's not good for the culture, but the fans caused this with all this fake outrage and closedmindedness in their consumerism.

 

[Rekkapryde]

All MS fault .....

 

[CoolinInTheCut]

I would prefer if Sony just reinvested in their own studios instead of buying new studios

 

[Black Mamba]

Come to papa Square Enix
Idgaf bout anything else
I just want Square Enix

 

[ALonelyDad]

Sony needs to buy SE, Capcom, Konami, Take 2, EA, CDRProject, Activision and Sega

 

[The Mad Titan]

Act like acquisitions or something new breh

 

[Bryan Danielson]

All MS fault .....

 

[Tribaligenesis]

Sony needs to buy SE, Capcom, Konami, Take 2, EA, CDRProject, Activision and Sega

Take two is worth more than Sony right now , not to put a damper on your exuberance

 

[Grand Conde]

Sony signalled a few days ago that they'll focus on partnerships; a clear sign that they are cutting back on spending considering the downturn in tech as a whole.

 

[Grand Conde]

Take two is worth more than Sony right now , not to put a damper on your exuberance

 

[Gizmo_Duck]

Take two is worth more than Sony right now , not to put a damper on your exuberance

I don’t know who told you that lol

 

[Tribaligenesis]

Sony needs to buy SE, Capcom, Konami, Take 2, EA, CDRProject, Activision and Sega

Take two is worth more than Sony right now , not to put a damper on your exuberance

I don’t know who told you that lol

Was talking about the software division but you're right there should have worded it better.You really think in a million years Sony would.be able to acquire take two . GTA is the name of the game. Just printing money for them