4 August 2017

Keywords Studios plc ("Keywords Studios", "the Group")

Acquisitions position Keywords Studios as the clear leader of the important French game localisation and voice-over recording market

Keywords Studios, the international technical services provider to the global video games industry, today announces the acquisitions of La Marque Rose SARL, Asrec SAS and the subsidiary companies of holding company, Dune Media SAS, trading as Dune Sound and Around the Word, which are all based in Paris and provide audio recording and localisation services to the video games industry internationally.

The acquisitions are in line with our strategy of consolidating our leading position in the highly fragmented video games services industry and generating synergies through scale in certain services and geographies.  These acquisitions will allow us to consolidate the leading providers of audio and localisation services in French which, together with German, remain the most important localised languages for games.

Our intention is to integrate La Marque Rose, Dune Sound, Around the Word and Asrec with our existing recording studio in Paris (acquired as part of the Synthesis acquisition in April 2016).  The scale of the combined operation will support an investment of around €1m in new audio recording studios and offices that will accommodate all 50 employees in a single location and provide a true destination for French voice-over recording.

All but one of the six founders and shareholders will remain in the businesses with Michel Golgevit, founder of Dune being appointed as CEO of the combined companies.

La Marque Rose was founded in 1989 and has a well-earned reputation for setting the gold standard in French audio for games. Established in 1998, Dune Sound (audio recording) and Around the Word (game localisation), which also has a small presence in Germany and in Canada, are together the largest providers of French language video game localisation.  Asrec started in 2010 and has been successfully providing Keywords, Synthesis and Binari Sonori with French audio recording for the past four years in a highly flexible and efficient manner. 

The businesses being acquired have combined annual revenues of €9.0m and profit before tax of €0.9m. The total aggregate consideration payable is €6.6m on day one and up to a further €1.0m over the two years to 31 December 2019, based on meeting performance targets for the combined businesses. Of the total aggregate consideration of up to €7.6m, up to €6.7m is being satisfied in cash, and the remainder through the issue of 75,796 new ordinary shares in Keywords. Of this total, 9,534 new shares will be issued on day one (and are subject to a 12 month hard lock-in) and the balance will be issued on the first anniversary of completion.

Application has been made to the London Stock Exchange for the admission of 9,534 new ordinary shares to trading on AIM. Admission of the new shares is expected to take place at 8.00am on 10 August 2017. The Company's total issued share capital following admission will consist of 55,797,528 ordinary shares of one pence each with one voting right per share. The above figure of 55,797,528 may be used by shareholders as the denominator for the calculations by which they can determine if they are required to notify their interest in, or a change to their interest in, the Company following admission.

Fulvio Sioli, European Managing Director of Keywords Studios, commented:

"These acquisitions are an important milestone in the development of our Localisation and Audio Services business lines in Europe. While the trend for game developers and publishers to increasingly source all languages from a single provider is clear, some clients continue to want to transact separately for individual languages. This is still most prevalent for those regarded as pillar languages of which French is probably still the most important.  The combination of La Marque Rose, Dune Sound, Around the Word and Asrec with our existing Keywords studio, gives us a leading share of this games production work.

"The consolidation of these businesses gives us the combined scale to support investment in new, state of the art recording facilities which will ensure that we can service the growing demand for French audio and localisation services, with the high level of quality our customers expect, for many years to come.

"We look forward to welcoming the teams at La Marque Rose, Dune Sound, Around the Word and Asrec into the Keywords family. We see this as the beginning of the next chapter in the market for French audio production, localisation and related media. Having such talented audio and localisation professionals pooling their expertise for the benefits of so many of the world's leading video games is exciting to see."

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About Keywords Studios (www.keywordsstudios.com)

Keywords Studios is an international technical services provider to the global video games industry. Established in 1998, and now with facilities in Dublin, Rio de Janeiro, Montreal, Quebec City, Portland, Orlando, Raleigh, Mexico City, Los Angeles, Seattle, Tokyo, Singapore, New Delhi, Pune, Rome, Milan, Barcelona, Madrid, Taipei, Shanghai, Beijing, Zhengzhou, Chengdu, Dalian, Manila, Yogyakarta, Hamburg, Paris and London, it provides integrated art creation, software engineering, testing, localisation, audio and customer care services across 50 languages and 14 games platforms to a blue-chip client base in more than 15 countries.  It has a strong market position, providing services to 23 of the top 25 most prominent games companies, including Activision Blizzard, Bandai Namco, Bethesda, Electronic Arts, Konami, Riot Games, Sony, Square Enix, Supercell, TakeTwo, and Ubisoft. Recent titles worked on include Uncharted 4: A Thief's End, Call of Duty: Infinite Warfare, Mortal Combat X, Assassin's Creed Syndicate, Battlefield 1, Overwatch, World of Warcraft: Legion, Hearthstone, Clash Royale, and Mobile Strike. Keywords Studios is listed on AIM, the London Stock Exchange regulated market (KWS.L).