Keywords Studios buys Enzyme games testing rival for CA$5.4m
(ShareCast News) - Video game industry services provider Keyword Studios has bought Canadian rival Global Video-Games Services, along with its subsidiaries including Enzyme Testing Labs, for CA$5.4m cash.
The jewel of the acquisition of GVGS, which is expected to be earnings enhancing, is Montreal-based Enzyme Testing Labs, "one of the most recognised technical services brands in the video games industry".
Enzyme has an office in Kawasaki near Tokyo, while it provides localisation services and focus group testing, with the latter fitting well with Keywords' recently acquired Player Research.
Enzyme would increase the company's functional testing capacity, which accounted for 8% of revenue in the first half of the year.
The business will be integrated into Keywords during 2017 and it is anticipated that resulting synergies will deliver "significant margin improvement".
Chief executive Andrew Day said: "The acquisition will not only generate considerable cost synergies but it will provide greater scale, flexibility and breadth of services for our combined interactive media clients globally."
For the year to 31 December 2015 Enzyme made revenue of CA$11.5m and profit before interest and tax of CA$1.3m, while net assets after adjusting for the loans being repaid are about CA$2.3m.