Netflix has announced it plans to acquire Finnish video game developer Next Games.
The streaming giant will pay €65 million ($72 million) for the mobile game company, according to a press release. Shareholders’ per-share value was set at around $2 to reach that valuation. Next Games is behind the mobile game Stranger Things: Puzzle Tales and The Walking Dead: No Man’s Land.
The deal makes sense for Netflix, in terms of continued growth; in-house mobile game development would hypothetically allow for a more streamlined and multi-platform approach to its many IPs, something that aligns with the company’s goals.
Michael Verdu, Vice President of Games at Netflix, said the Next Games is well equipped to help move the company’s strategic goals forward.
“Next Games has a seasoned management team, strong track record with mobile games based on entertainment franchises, and solid operational capabilities,” Verdu enthused. “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.”
Next Games has about 120 employees and sales of around $30 million last year. The company said about 95% of its revenue comes from in-game purchases.
Teemu Huuhtanen, Chief Executive Officer of Next Games, said the acquisition is part of the company’s overall vision.
“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,” Huuhtanen said. “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.”
Huuhtanen is a veteran in the mobile game industry, and brings a wealth of institutional knowledge to Netflix. Before he started Next Games in 2013, he worked at Rovio, publisher of the cultural touchstone Angry Birds, one of the most popular mobile games of all time.
The deal is set to be finalized in Q2 of this year, and is subject to standard regulatory closing conditions.