Dublin-based Keywords makes UK firm its first target in planned acquisition spree
Video game services firm Keywords Studios has bought UK game developer Coconut Lizard for €2.2m – its first deal since building up a €110m war chest to acquire smaller rivals.
Keywords last month raised the funds via a UK share placing. The Dublin-based firm said the money would be used to hoover up video game services and development firms weakened by the Covid-19 crisis.
Coconut Lizard, based in Gateshead near Newcastle, was founded in 2014 by managing director Robert Troughton and previously owned by US firm Epic Games. It specialises in support for developers who use Epic’s Unreal Engine game architecture. This is used by many firms, including Keywords, to build a wide variety of games.
"The Coconut Lizard team will bring further expertise in the Unreal Engine as well as access to our wider team of around 1,000 people working across our game development studios internationally,” said Keywords chief executive Andrew Day.
"We expect to complete further acquisitions over the months ahead from the strong and attractive pipeline of opportunities that we are currently reviewing,” said Mr Day, whose firm has acquired 45 firms over the past six years.
Coconut Lizard works with Microsoft’s Rare studio in supporting and developing its multiplayer game Sea of Thieves.
Keywords said the deal would give it an edge in recruiting graduates from video game development programmes at the nearby University of Sunderland and Newcastle University.
Coconut Lizard reported £1.5m (€1.65m) in revenue for the year ending in March. It recently hired 10 developers to expand its Gateshead staff to 30 – all of whom have their own cartoon portrait on the firm’s website.