Tencent Holdings has agreed to acquire UK games developer Sumo Group in an all-cash deal at a price of GBP 5.13 per share. The deal values Sumo at around GBP 919 million. Tencent will make the acquisition through indirect wholly-owned subsidiary Sixjoy Hong Kong. The deal is expected to close in Q4 2021.
The purchase price of GBP 5.13 per share represents a premium of around 43.3 percent compared to the closing Sumo share price of GBP 3.58 on 16 July, the last business day before Tencent's announcement. It also represents an enterprise value multiple of around 55.4-times Sumo's adjusted EBITDA for the year ending 31 December 2020. The Sumo board believes the terms of the offer to be in the best interest of shareholders and is recommending that they approve the deal at a General Meeting. Sumo has 14 studios in five countries worldwide, with more than 1,200 employees.
