Modern Times Group has agreed to buy Plarium, the maker of RPG Raid: Shadow Legends, from Aristocrat Leisure for $620 million.
MTG is acquiring 100% of Plarium Global, a Tel Aviv, Israel-based game studio with a long history of success in mid-core mobile games. MTG said the acquisition will substantially improve its already strong cash flow generation. Of the $620 million, about $20 million will be deferred for payment in 2026.
The consideration will be offset by the cash flow that will be generated from the start of Q4 2024 until closing, which is expected in the first quarter of 2025, resulting in an estimated final EV/adjusted EBITDA multiple below 4.5 times.
There will be a performance-based earnout structure of $30 million based on Raid: Shadow Legends revenues for 2025, and MTG will book that on the balance sheet. There is a second potential stretch earnout target of up to $170 million based on Plarium’s 2028 revenues, which will not be booked on the balance sheet.
Plarium mixes well with MTG and the deal results in one of the strongest mid-core mobile gaming portfolios in the industry to power future organic growth, the companies said.
Plarium generated $613 million in revenues and $137 million in adjusted EBITDA and $110 million in free cash flow for the LTM period ended 30 September 2024.
The combined group will have total annual sales in excess of $1.1 billion and adjusted EBITDA in excess of $275 million, nearly doubling MTG’s EBITDA and free cash flow and the acquisition is expected to be strongly EPS accretive. Banks are providing about $460 million of the debt for the purchase price.
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