UPDATED. We kick off today with an exit in a segment we don’t often write about. Carlyle has agreed to sell a UK video game developer and publisher to CVC Capital Partners and Haveli Investments.
Next, we have a report on European mid-market activity from DC Advisory, which predicts Europe is poised for a gradual recovery.
We’ll finish up with an add-on, as Vaalon Capital-backed Unitrailer holding has made its first acquisition outside its home country Poland, snapping up a Dutch trailer producer.
What better way to start a Friday than talking about video games. Carlyle has agreed to sell Jagex, a video game developer and publisher, to CVC Capital Partners Fund VIII and Haveli Investments.
The deal has an enterprise value of £910 million (€1.1 billion; $1.2 billion), according to sources close to the matter.
Headquartered in Cambridge in England, Jagex is best known for RuneScape, a massively multiplayer online roleplaying game. The game has 2.4 million active subscribers and one million free-to-play users. Jagex publishes video games for PC and mobile and has around 700 employees.
Carlyle invested in Jagex in 2021 through Carlyle Partners VII and Carlyle Europe Technology Partners IV. During the ownership period, Carlyle increased growth across Jagex’s core titles and broadened the distribution of the company’s games portfolio. With Carlyle’s backing, Jagex also acquired two developers: Gamepires and Pipeworks Studios.
“CVC has followed the video games space for many years with great interest. We are huge fans of the RuneScape games, the large global community of players, and the Games-as-a-Service capability at Jagex,” said Nick Clarry, managing partner and head of CVC’s sports, media and entertainment team. “Our ambition is to bring relevant experience from our sports, media and entertainment assets to help realise the full potential of Jagex over the years ahead. This will involve continuing to improve the existing RuneScape games, the accessibility to games on various platforms, and reinvesting into new IP content to create the exciting games of tomorrow.”
Let’s dive in to the state of the European mid-market, with the help of DC Advisory’s Mid-Market Monitor report for Q4 2023.
Overall, the report calls European mid-market resilient and adaptable, poised for gradual recovery, driven by strategic investments.
In Q4 2023, the volume of private equity exits was the lowest in over a decade resulting in a build-up of investments within portfolios, the report said. This will drive funds to seek alternative exit paths and defer asset sales until more favourable market conditions and improved valuations emerge. We’ve covered a good chunk of exits here on PE Hub Europe since the start of 2024 – you can read my round up of January exits here.
Sector-wise, industrials, technology and software dominated European PE transactions, according to the report. Business and tech-enabled services saw an increase in M&A activity.
The UK remained the most active region in terms of investment activity, with a 28.1 percent share of the total volume of deals in Q4 2023. That figure is the highest for a decade, the report added.
Challenging market conditions, a focus on decarbonisation, recycling and digitisation has led to increased private equity interest in infrastructure, according to the report. Demographic growth and circular economy initiatives present opportunities in renewable energy, waste reduction and digital infrastructure.
Before signing off, let’s take a look at an add-on. Vaalon Capital portfolio company Unitrailer, a Polish commercial trailer maker, has acquired Dutch peer Henra Aanhangwagens in a move to consolidate the “highly fragmented” European trailer market.
Unitrailer is Poland’s biggest producer of trailers with gross vehicle weight up to 3.5 tonnes, according to a release, and aims to become the biggest company in the European market within two years. The company is targeting consolidated sales of at least €300 million, up from about €100 million today, and a market share of 10-13 percent.
Henra is Unitrailer’s first acquisition outside Poland, but it is in talks to acquire other European companies, the release said.
Unitrailer’s products haul cars, boats, motorsport equipment and cargo, and are used mainly by individuals and small businesses. Vaalon Capital-backed European Trailer Holdings acquired it last year. The company is based in Świdnik.
Editor’s note: This story has been updated to include the enterprise value of the Jagex exit.