Nazara picks up majority stake in e-sports platform NODWIN Gaming

Mumbai-based mobile games developer Nazara Technologies Ltd has acquired a majority 55% stake in Gurgaon-based e-sports platform NODWIN Gaming, a company statement said.

Nazara indicated that the newest transaction was line with its 2017 foray into the e-sports space. NODWIN will continue to operate as an independent subsidiary, the press note added.

“Through this acquisition, we aim to provide Indian e-sports enthusiasts a robust player and community-orientated e-sports ecosystem in which players can thrive, improve their skills and become top competitors at an international level,” Manish Agarwal, chief executive of Nazara Technologies, stated in the release.

Nazara and NODWIN will build intellectual properties in emerging markets across soccer, cricket and other traditional sports.

Consulting firm EY served as the financial adviser to the transaction.

NODWIN was founded by Akshat Rathee and Gautam Virk in January 2014. Rajan Navani, vice chairman and managing director of digital entertainment firm JetSyntheses, joined as an investor later. The company operates as a 50:50 joint venture between Akshat Rathee, Gautam Virk, and JetSynthesys.

NODWIN has the exclusive long-term India rights for global partners such as Electronic Sports League and Esports World Convention among others. NODWIN hosts and manages IP-based gaming events such as the ESL India Premiership, The Dew Arena by ESL, KO Fight Nights and The North East Championship.

According to a research by market research firm Newzoo, the global e-sports market had grown to $748 million in recent years and is expected to grow to $1.2 billion in 2018.

The global e-sports audience has rapidly risen from 86 million in 2015 to an estimated 386 million in 2017. This is expected to grow at a compounded annual growth rate of 14.0%, reaching 665 million in 2021.

However, research by Frost and Sullivan indicated that the Indian e-sports audience is currently very nascent with an estimated 2 million enthusiasts and 2 million occasional viewers. However, this is expected to grow more than fivefold by 2021.

The latest announcement by Nazara comes a little over two weeks after it picked up a majority stake in Chennai-based gaming company Nextwave Multimedia.

In November last year, it invested in Mumbai-based fantasy sports platform HalaPlay along with early-stage investment firm Kae Capital. In August 2017, it invested an undisclosed sum in Noida-based Moong Labs Technologies Pvt. Ltd, a developer of 3D cricket simulation games.

In 2016, it picked up 26% stake in London-based mobile gaming studio Mastermind Sports Ltd.

Established in 1999 by Nitish Mittersain, Nazara grew after the dot-com bust and has expanded to over 74 countries over the last decade. It has been profitable since 2007.

In December last year, as a precursor to Nazara’s public float, IIFL Special Opportunities Fund bought a minority stake in the games developer for $51 million (Rs 330 crore). The fund mainly invests in companies before or during their IPOs. This was then followed by an investment by India’s top stock market trader Rakesh Jhunjhunwala, who put in Rs 180 crore ($27 million) in the firm. In November 2016, VCCircle had first reported Nazara’s plan to hit the road for an IPO.

The company’s listing process is already underway and it has mandated ICICI Securities and Edelweiss Financial Services for the IPO. Nazara plans to complete the listing process by the end of March 2018 and is expecting a valuation of 30-35 times the projected profit after tax of Rs 100 crore for 2018-19.

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