13 August 2024

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

 Acquisition of Wushu Studios Limited ("Wushu") 

Leading UK-based game development studio adds further scale to Create Division

Keywords Studios, the international provider of creative and technology-enabled solutions to the global video games and entertainment industries, is delighted to announce the acquisition of Wushu Studios Limited, a leading game development studio headquartered in Liverpool, United Kingdom.

Wushu was founded in 2017, initially as an original IP studio, before transitioning to a work-for-hire model, providing a range of services to high-profile publishers and developers on co-development and full development projects as well as porting & remaster work and live support services. Wushu employs c.160 people, with multiple project teams working closely with clients to develop a range of high-quality games. Recent titles Wushu has worked on include Fall Guys, State of Decay, Forza Horizon 5 and Baldur's Gate 3.

Wushu has grown well despite current market turbulence, with adjusted revenues of approximately £12.5m and an adjusted EBITDA margin in line with that of the Group expected in the year ending 31 August 2024. Wushu's founder and majority owner Alan McDermott and his management team will remain with the business post-acquisition as they look to continue Wushu's growth which is underpinned by a strong pipeline of high-quality projects.

The consideration comprises an upfront and earn-out component and is expected to fall within the Group's targeted valuation range. The upfront consideration was paid in cash and funded from the Group's existing revolving credit facility.

Bertrand Bodson, CEO of Keywords Studios, commented on the acquisition: "We are thrilled to welcome Wushu to Keywords. The acquisition aligns with our strategy to build out our game development offer globally. We now have two studios in Liverpool which is a key regional hub for talent in the UK. Wushu's highly skilled team, strong relationships and opportunities for growth will be important assets that complement our existing Create studios as we continue to enhance our offering to our global client base. We look forward to working with Alan and the talented team over the coming years to support and drive growth in the business."

Alan McDermott, Founder of Wushu Studios, further commented: "This is an exciting new chapter for Wushu. Joining Keywords allows us to maintain our creative independence while gaining access to a wealth of resources and expertise. It allows us to further enhance the services we offer our long-term clients with an extensive resource network and broad skillsets. Keywords shares our ambitions for continued growth, and their investment in Wushu will help us continue to remain faithful to our people-first approach to development. We look forward to collaborating with the broader Keywords network and taking on ever more ambitious projects in the future."

About Keywords Studios (www.keywordsstudios.com)

Keywords Studios is a global provider of creative and technology-enabled solutions to the video games and entertainment industries. Established in 1998, and now with over 70 facilities in 26 countries strategically located in Asia, Australia, the Americas, and Europe, it provides services across the entire content development life cycle through its Create, Globalize and Engage Divisions to a large blue-chip client base across the globe.

Keywords Studios has a strong market position, providing services to 24 of the top 25 most prominent games companies and contributing to over 70% of the 2023 Game Awards winners. Across the games and entertainment industry, clients include Activision Blizzard, Bandai Namco, Bethesda, Electronic Arts, Epic Games, Konami, Microsoft, Netflix, Riot Games, Square Enix, Supercell, Take-Two, Tencent and Ubisoft. Recent titles worked on include Starfield, Baldur's Gate 3, Diablo IV, Hogwarts Legacy, Elden Ring, Fortnite, Valorant, League of Legends and Clash Royale. Keywords Studios is listed on AIM, the London Stock Exchange regulated market (KWS.L).

About Wushu Studios (https://wushustudios.com/)

At Wushu Studios, our passion lies in the art of game development, but our success is entirely attributable to incredible people. As an independent game development studio, our journey is driven by the thrill of creating cutting-edge games and delivering unparalleled experiences to players worldwide. Everything we do is fuelled by innovation, creativity, and, most importantly, collaboration. Our team is a diverse group of world-class, creative, and dedicated developers, and they are the heartbeat of our studio. Our collaborative efforts have given rise to a spectrum of games, from enchanting role-playing games to blockbuster AAA titles. We pride ourselves on the long-standing relationships we've developed with global publishers and incredible studios.