Keywords Studios to be taken over by EQT in £2.1bn deal

AIM-listed Keywords Studios said on Wednesday that it has agreed to be taken over by European private equity firm EQT in a £2.1bn deal.

Under the terms of the agreement, EQT will pay 2,450p per share in cash. This is a premium of around 66.7% to the closing share price on 17 May, which was the last day before the start of the offer period.

Keywords chief executive Bertrand Bodson said: "This offer from EQT marks an exciting new chapter on our growth journey, with a like-minded partner who possesses deep sector expertise and a desire to accelerate the pace of our growth, both organically and through M&A, to unlock the many opportunities ahead of us across the entertainment landscape.

"I am convinced that together we will be able to strengthen our leadership position at the heart of the largest entertainment industries in the world and build a truly unique global integrated games services platform for the benefit of our people and clients."

At 1005 BST, the shares were up 2.8% at 2,383.86p.

Russ Mould, investment director at AJ Bell, said: "The target’s board has recommended the deal and if successful, it would conclude 11 years on the market for one of AIM’s biggest success stories.

"Keywords was only worth £49 million when it floated in 2013, but the shares subsequently spent many years shooting upwards as it hoovered up all kinds of businesses related to the computer games industry.

"At its peak in 2021, Keywords was valued at £2.5 billion, which is quite an ascent from its IPO. The gaming industry has gone through a difficult patch of late, hence why Keywords’ shares suffered from a big pullback in 2023, but EQT has clearly spotted an opportunity to buy a comprehensive entity for a slight discount versus its heyday. Its bid values the group at £2.1 billion."