M&A and investment in the game sector Realising investments and acquiring game businesses Realising investments and acquiring game businesses Recent years have seen a huge financial and legal advisers. It’s not growth in M&A activity within unusual to run a competitive auction the video game industry, both from process with concurrent negotiations existing players and new investors. with multiple potential buyers. This Be it a publisher or non-traditional will likely result in a longer deal game business making a strategic timetable, but also potentially the investment, a financial institution best outcome for the seller. investing in the sector for the first Alternatively, there may be a bilateral time, or a founder preparing process, where a single buyer and for life-changing investment in their the seller agree the terms of the studio, these types of transactions acquisition early. This can be a raise many important commercial simpler and faster route and doesn’t and legal issues. necessarily result in a lower valuation of the business. Advisers will be key to The sale of any company is a deciding the most suitable approach. complex exercise and should always be approached together with legal Whether an auction or bilateral and financial advisers. So what are process is adopted, at some point the parties will likely enter into an some of the key considerations and exclusivity letter and term sheet. This issues arising on the M&A sale of document will set out a summary of a video game business? the key commercial terms the parties Deal timetable and process intend to agree in the final legal documentation and will lock them The broad outline of an M&A sale into a period of exclusive negotiation process will usually initially be drivenwhile that documentation is agreed. by the seller, with advice from its The entire process from term sheet to 17