British publisher Jagex acquires Croatian studio Gamepires, creator of the popular game SCUM

Jagex, a British video game developer and publisher, has announced the acquisition of the Croatian video game studio Gamepires, best known for creating the popular survival game SCUM. This is Jagex’s second acquisition this year, the publisher of RuneScape, which aims to support Gamepires in their development of SCUM 1.0 for multiple platforms. Prior to Gamepires, in July of this year, Jagex acquired American Pipeworks Studios to strengthen its position in North America.

According to Jagex, they share a common interest with Gamepires, which is games that are important to the community.

– Building gaming communities is key to what we do at Jagex, and this shared passion is why we are excited to welcome Gamepires. We believe in the vision of Tomislav (Pongrac), Andrej (Levenski), and their talented team who have built an impressive open-world survival game, nurtured a highly engaged community, and developed a strong profitable business. With our support and the support of our publishing team Jagex Partners, together we will make SCUM an even greater global success – said Phil Mansell, CEO of Jagex.

Tomislav Pongrac, co-founder and creative director of Gamepires, emphasized that their partnership with Jagex provides an opportunity to elevate SCUM to the next level.

– Jagex’s world-class reputation as a company where players drive game development aligns with our ethos and will help us grow as entrepreneurs and as a studio. We are extremely excited to see how we can build upon everything we have achieved with SCUM so far and leverage the game to its full potential – said Pongrac.

In early 2021, global investment group Carlyle acquired Jagex to support their growth strategy, including mergers and acquisitions. Michael Wand, CEO and co-head of the advisory team at Carlyle Europe Technology Partners, says they are pleased to ‘support Jagex in acquiring another very talented development team’.

– This acquisition further diversifies Jagex’s portfolio of quality development studios by creating unique community-focused gaming experiences – added Wand.

The terms of the transaction have not been disclosed, but it is known that IMAP and Ostermann & Partners acted as financial and legal advisors to Gamepires’ shareholders. KPMG acted as financial and tax advisor to Jagex, and Wolf Theiss as legal advisor.

Jagex’s announcement also states that the company employs over 450 people in Cambridge where it is headquartered. In 2021, Jagex generated £124.86 million in revenue, marking a record profit and a 4 percent increase compared to the previous year.

New momentum

Gamepires has achieved significant success in the 12 years since its founding. On the first day of its release on the Steam platform in 2018, their game SCUM sold 250,000 copies, and in three weeks over a million. To date, SCUM has sold over three million copies, and Steam has placed it on its list of the Top 100 most played games.

As Andrej Levenski, co-founder and technical director of Gamepires, revealed to Lider, they decided to sell because they planned to accelerate the company’s growth, and this seemed like the perfect way and opportunity.

– Just last month we sold 120,000 copies of SCUM. We realized that in ten years we could achieve even more, so we looked at how we could accelerate that growth. There were quite a few negotiations about merging with several different companies, but Jagex was the most similar to us. As their CEO said, we are them from ten years ago. Currently, we are 55 in the company and are thinking about how to optimize growth, and Jagex has gone through all of this, they have the experience and the money and games similar to ours – explained Levenski how the acquisition of Gamepires came about in six months.

For 2022, Levenski expects quite good revenues and an EBITDA of four million euros. He emphasizes that in recent months they are 20 percent ‘in the black’, as they have invested in promotion and marketing.

Thanks largely to SCUM, Gamepires is now among the largest Croatian video game development companies. With revenues of 28.7 million kuna in 2021, Gamepires recorded a significant decline compared to the revenue from the pandemic year of 2020 when the global video game sector experienced its biggest boom. At that time, Gamepires’ revenues even rose to 52.8 million kuna. However, Levenski explains that the unrealistic growth of the global video game sector from 2020 has now ‘leveled out’ to a realistic level. Therefore, we now notice in Gamepires, but also in many other video game development companies, lower revenues than in 2020.

Gamepires exports its games worldwide, with the highest sales in the markets of China, the USA, Thailand, Argentina, and Russia.

As Levenski previously stated to Lider, they are already working on version 1.0 of SCUM, and even after its release, work does not stop ‘because it is a project that behaves more like a game–as-a-service where new updates are constantly released for the already launched game’. With its expertise, Jagex will accelerate that process.