Tuesday, July 23, 2024

Nazara Technologies to Acquire 28% Stake in Nextwave Multimedia

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Mumbai-based gaming and entertainment company, Nazara Technologies, is set to acquire the remaining 28.12% stake in its mobile gaming subsidiary, Nextwave Multimedia. The acquisition will cost Rs 21.63 crore and will be completed in two tranches. This move is part of Nazara’s strategy to consolidate its gaming assets and enhance its market presence.

Nazara Technologies was founded by Nitish Mittersain in 1999 as an online gaming portal. From 2002, it switched to providing mobile entertainment VAS for telecom operators, including WAP content downloads of comic strips and mobile games.

The acquisition process is divided into two tranches. In the first tranche, Nazara Technologies will purchase 1,000 shares, representing a 3% stake in Nextwave Multimedia, for Rs 2.3 crore in cash. The second tranche involves buying 8,375 shares, which equates to a 25.12% stake, for Rs 19.33 crore. This payment can be made either in cash or through the issuance of Nazara Technologies stock within six months after the first tranche is completed.

Merging Nextwave into Nazara

Nazara Technologies initially acquired a majority stake in Nextwave Multimedia in 2018 and increased its ownership to 71.88% in May 2023. After this transaction, Nazara plans to merge Nextwave Multimedia and its intellectual property (IP) into the parent company. This strategy aims to extract synergies and capture cash flows directly at the parent level. Nazara may apply a similar approach to other existing games and new acquisitions in the future.

Nazara Technologies Office and company logo.

About Nextwave Multimedia

Company founded in 1995, Nextwave Multimedia is best known for developing the World Cricket Championship (WCC) franchise. The company focuses on creating casual and multiplayer mobile games, especially in the sports genre. Last year, Nazara appointed Christopher Franklin as CEO of Nextwave Multimedia, succeeding founder PR Rajendran, who now serves as board chairman. Over the past year, Rajendran has helped ensure a smooth transition and shared his knowledge of the WCC franchise.

Enhancements and Growth

Nazara Technologies reported improvements in Nextwave Multimedia’s ad monetization, live operations, brand sales, and user acquisition strategies. These enhancements are expected to boost retention and revenue for the WCC franchise in fiscal year 2025. The WCC games have achieved over 100 million downloads across mobile platforms in the last seven years, with approximately 8.1 million monthly active users in the fourth quarter of fiscal year 2024, including about 1.1 million daily active users.

Future Plans of Company

Nazara plans to leverage Nextwave Multimedia’s expertise to expand the WCC franchise and introduce new games. The first new game launch is anticipated in the first quarter of fiscal year 2025. Additionally, Nextwave Multimedia recently acquired all intellectual property rights for “UTP – Ultimate Teen Patti,” a casual freemium card game from U Games, a subsidiary of Games24x7.

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