505 Games’ parent company, Digital Bros., has finalised its acquisition of all Smilegate Holdings’ Starbreeze AB’s assets for €19.2 million (£16.2m).
The deal – which was first announced in January – has now been settled, with 505 buying out assets held by South Korean developer/publisher, Smilegate Holdings. According to a press statement, the overall assets nominal value is approximately €36.7 million (£31.1m).
Following the acquisition, Digital Bros will own 28.01 per cent of Starbreeze AB’s share capital and 29.93 per cent of the voting rights (an estimate based on the number of outstanding shares and the number of outstanding voting rights as communicated by Starbreeze on February 19th, 2020).
“In the light of the existing business relationship, Digital Bros considers the increase of its interest in Starbreeze AB as a step enabling the Group to exert greater control over the corporate strategy of Starbreeze AB going forward,” the company said in January.
The Payday 2 developer submitted an administrator-approved plan to the Stockholm District Court in November 2019 to allow the studio to repay its debts after it revealed in August 2019 that it had closed the second period of the financial period with an EBITDA (earnings before interest, tax, depreciation, and amortization) loss of SEK 25.8m/$2.7m. It successfully completed a reconstruction process in December 2019.
Starbreeze hopes to repay the debts they had accrued as of December 2018 within five years, with an interest rate of 5 per cent. The plan is intended to allow Starbreeze to repay the company’s creditors, who are separated into two categories: “supplier creditors” who are owed over SEK 1.04m/$107,000, and “minor supplier creditors” who are owed less.
While the PayDay developer continued to sell off its assets – most recently Psychonauts 2 and 10 Crowns – and has bumped up net revenue by SEK 14.4m, the sale of the publishing rights generated SEK 137m, which accounts for a whopping 85.6 per cent of the company’s total revenue over that period. PayDay 2 continues to be the studio’s key income generator but that too has seen a significant drop, earning just SEK 14.5m compared to last year’s SEK 31m.
