Streaming giant Netflix announced its acquisition of Next Games for €65 million ($72 million). Next Games, based in Finland, is a developer of mobile games and is listed on the public markets of Helsinki, Finland.
The deal comes as an all-cash share purchase at €2.10 in per share. Next Games’ board has already issued its approval for the deal and is recommending the acquisition to shareholders. The deal is expected to be completed by the second quarter of this year.
For months now, Netflix has been trying to diversify and the gaming world was where it deemed fit to venture into. Its plan to acquire Next Games is, therefore, a part of its big strategy to enlarge is gaming content which it is offering alongside its video streaming service.
Next Games already has titles based on some of Netflix biggest shows. This suggests that the two companies already have a cordial relationship and have been working together. Next Games developed games Stranger Things and The Walking Dead based on the eponymous shows.
The acquisition will not only broaden Netflix’s game content, the company will also get to enjoy Next Games’ IP talent and existing business selling in-app purchases. All these and more will become Netflix’s.
In a statement, Netflix’s Vice President of games – Michael Verdu, said that “Next Games has a seasoned management team, strong track record with mobile games based on entertainment franchises, and solid operational capabilities. We are excited for Next Games to join Netflix as a core studio in a strategic region and key talent market, expanding our internal game studio capabilities. While we’re just getting started in games, I am confident that together with Next Games we will be able to build a portfolio of world-class games that will delight our members around the world”.
On its own, Next Games isn’t doing bad at all. Its last annual results showed that it had 120 employees at the end of 2021, revenues of €27.2 million as of 2020 and 95 percent of its sales came from in-app purchases.
Next Games’ co-founder – Teemu Huuhtanen, in a statement said that “We have had an unwavering focus to execute on our vision: to become the partner of choice for global entertainment businesses and craft authentic and long-lasting interactive entertainment based on the world’s most beloved franchises. Joining forces with the world’s largest streaming service, Netflix presents an opportunity for a logical and exciting continuation of our strategy to craft interactive experiences for the world to enjoy. Our close collaboration with Netflix on Stranger Things: Puzzle Tales has already proven that together we create a strong partnership. This is a unique opportunity to level-up the studio on all fronts and continue on our mission together”.
Netflix’s increased efforts into its gaming venture come at a time when the company faces increased competition from other rivals, and this may be its way of staying above the waters.