MTG completes acquisition of tower defense gaming studio and publisher Ninja Kiwi
Swedish gaming and esports entertainment company Modern Times Group MTG AB, MTG, has completed the acquisition of 100 percent of the shares in leading tower defense gaming studio and publisher Ninja Kiwi Limited, which was announced through a press release on 24 March 2021.
Since the announcement of the acquisition, Ninja Kiwi has continued to deliver on its strategy, resulting in continued strong performance from the company. In March 2021, Ninja Kiwi's title Bloons TD 6 crossed the threshold of SEK 603 million (NZD 100 million) lifetime revenue. With its new game Bloons Pop due for imminent release and the long-awaited Battles 2 game releasing in late 2021, the company is set for further growth.
The total upfront purchase consideration amounted to SEK 1,216 million (NZD 203 million), on a cash and debt free basis. Of the upfront purchase consideration, SEK 541 million (NZD 90 million) was paid through a directed share issue to the sellers of Ninja Kiwi of 4,435,936 new class B shares in MTG, which were paid by way of set-off.
Out of the remaining part of the upfront purchase consideration, equivalent to SEK 675 million (NZD 113 million), SEK 574 million (NZD 96 million) was paid in cash and the remaining SEK 101 million (NZD 17 million) will be paid in cash at the end of 2021.
The new share issue was resolved on the date hereof by the board of directors of MTG based on the authorization granted at the Extraordinary General Meeting held on 18 May 2021. The reason for the deviation from the shareholders' pre-emption right is to allow MTG to fulfill its commitments in connection with the acquisition of Ninja Kiwi.
The subscription price per share amounts to the equivalent of SEK 121.9, corresponding to the volume-weighted average price of the class B shares on Nasdaq Stockholm during 24 February – 23 March 2021. Through the new issue of the shares, the share capital of MTG will increase by SEK 22,179,680. The newly issued shares were subscribed and paid for by set-off by the sellers on the date hereof.
The sellers of Ninja Kiwi have entered into lock-up undertakings which means that the sellers, subject to certain exceptions, undertake not to transfer, pledge or otherwise dispose of the class B shares issued as part of the upfront purchase consideration during a lock-up period of between one and three years, with parts of the class B shares being released from the lock-up gradually during such period (and any class B shares issued as part of any earn-out consideration will be subject to a one year lock-up).
The new issue of shares will lead to a dilution for the current shareholders in MTG of approximately 4 percent on a fully diluted basis (i.e., based on the total number of shares and votes registered in MTG after completion of the share issue in relation to the transaction).