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Jagex buyout falters: Sky News

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Tuffty
Jan
fmod Member
2003

Tuffty

Forum Moderator Posts: 152,207 Ruby Posts by user Forum Profile RuneMetrics Profile
Ohhh dear not good news.

Big investment for someone.

Maybe it's peaked at max price. $800m is a good deal for they paid though.

I'd love to put in a offer. Sadly mine would be rejected. It's a tiny bit less then $800m

Who ever buys it will get a great game with great staff. ;)

Fingers crossed for Jagex. Comprehensive Account Security
Live long and Prosper...... :P

19-Dec-2023 10:04:33

Dilbert2001
Jun Member 2006

Dilbert2001

Posts: 30,311 Sapphire Posts by user Forum Profile RuneMetrics Profile
"A number of other large buyout funds are said to have examined offers and decided against submitting bids because of uncertainty about the company's business plan and development pipeline."


Here we go... This armchair CEO in me has expressed concerns on the clarity of future business plan and at least I would have to see near term roadmap before I could pitch the company to potential new buyers with focus on the unique and proven 22+ years of renowned IP, technologies and diversity of RS3.

Regretfully, June UK Bidco followed the worst of the worst advices and went with the stupidest one-off pump and dump Jenga trick on a non-marketable product the last 2 months and came back absolutely empty-handed.

Anyway, if this report is accurate, £800m is a very good price for the UK June Bidco controlled Jagex already. I would be willing to pay far closer to the $530 mil price they paid for Jagex personally, so for £800m I think Jagex is as good as sold. Let's see if we will have a new Jagex owner after the Christmas and New year holidays. :)

19-Dec-2023 16:04:54 - Last edited on 19-Dec-2023 16:05:50 by Dilbert2001

Dilbert2001
Jun Member 2006

Dilbert2001

Posts: 30,311 Sapphire Posts by user Forum Profile RuneMetrics Profile
"Who ever buys it will get a great game with great staff."


I think Jagex's other games, especially SCUM, add quite a bit of valuation to the 800 mil pounds bid.

SCUM has also laid out their plan precisely for their community and investors. We know they are launching on consoles with patch 1.0 precisely (and now they are at v0.95, and Jagex will bring them out of beta for full launch globally under multiple platforms and not just Steam.

Jagex also explicitly mentioned SCUM as one of their forever games. Some investors probably like their future potentials so they offered more. If things go on as planned, don't be surprised the SCUM franchise will worth more than Runescape.

I think potential bidders are turned off mostly by the stupidest moves they did with their most precious Runescape franchise recently.

19-Dec-2023 23:53:44 - Last edited on 20-Dec-2023 00:00:05 by Dilbert2001

Dilbert2001
Jun Member 2006

Dilbert2001

Posts: 30,311 Sapphire Posts by user Forum Profile RuneMetrics Profile
Diving a little deeper into the valuation of Jagex, we may actually take a look at other Jagex's forever games like SCUM and see the thought process of buyers who are willing to bid $1 billion for Jagex.

We know SCUM has the track record of selling over 1 million copies of the game just 3 weeks into its release. At $40 a copy, it meant $40 mil revenue in just 3 weeks just from box fees already. and not even counting MTX and DLC sales the game offered.

Now, we look at the total revenue in the last Jagex financial report... the entire Jagex Studio combined to bring in about less than $160 mil in the full year and that was the record revenue.

New investors probably look at the barrage of business activities on the horizon, like going to consoles, fully launching globally in different platforms etc, and think if they can sell just 1 million copy and generate $40 mil in less than a month, they will have a $40 almost instant rebate to the extra $$$ they added to Jagex's price tag. Note that $40 mil in a month is 25% of the entire Jagex combined to make in a year. It is quite signifcant, and SCUM is not scum like other low return investments.

20-Dec-2023 17:03:53

Dilbert2001
Jun Member 2006

Dilbert2001

Posts: 30,311 Sapphire Posts by user Forum Profile RuneMetrics Profile
Jagex are doing something they have never done since they incorporated in UK in 2001 - failed to file the mandated annual Companies House Accounts reports 2 years in a row on time:

"Accounts overdue
Next accounts made up to 31 December 2022
due by 31 December 2023

Last accounts made up to 31 December 2021"


https://find-and-update.company-information.service.gov.uk/company/03982706

Something interesting is probably coming up, and perhaps they need more time to get the financial numbers verified by independent accounting firms... like before the sale of the company?

Anyway, they will have to file the mandated Companies House report unless they want to incorporate outside UK.

Their financial numbers are probably going to be quite pretty for 2022 as they kind of preannounced the bottom line number to Reuters, and as expected for companies putting up a $1 billion price tag. No worries there probably, but the more interesting facts will probably be revealed under some of their details on their future plans and Safe Harbour statements.

02-Jan-2024 16:59:09 - Last edited on 02-Jan-2024 17:00:29 by Dilbert2001

Dilbert2001
Jun Member 2006

Dilbert2001

Posts: 30,311 Sapphire Posts by user Forum Profile RuneMetrics Profile
"Sky News has learnt that private equity firms, including Advent International and CVC Capital Partners, submitted first-round offers for Jagex late last week."


Unless somebody pays more, one of Advent International or CVC Capital may be Jagex's new boss.

Well, at least I'll pass if it takes over $1 billion to buy Jagex.

Whoever pays $1 billion to buy Jagex will undoubtedly looking to sell Jagex for at least $2 bil or $3 bil a couple of years down the road. Look for a lot of M&A and publishing initiatives injected into the new Jagex soon after the sale.

03-Jan-2024 02:17:36

Dilbert2001
Jun Member 2006

Dilbert2001

Posts: 30,311 Sapphire Posts by user Forum Profile RuneMetrics Profile
"Potential buyers are likely to include private equity firms, which could use Jagex as a platform to buy a string of smaller companies within the sector, one source said."


https://www.reuters.com/markets/deals/carlyle-weighs-options-runescape-creator-jagex-sources-2023-09-07/

A new platform of games and buying more companies for more games is vastly viewed as the strategy of the new Jagex.

I agreed with this sentiment too, and it is pretty much what the next Age of Jagex will shape up to, and perhaps the only way the next Jagex can worth over $1 billion.

16-Jan-2024 18:55:21 - Last edited on 16-Jan-2024 18:58:01 by Dilbert2001

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