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BFI: More than 50% of UK games developers are now owned by overseas entities

The US accounts for 49% of overseas transactions followed by China’s 15%
BFI: More than 50% of UK games developers are now owned by overseas entities
Date Type Companies Involved Key Datapoint
Nov 13, 2023 report British Film Institute
  • 76,000 jobs are currently being supported by the UK games industry
  • 51.9% of video games development staff in the UK are employed by overseas entities
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New research from the British Film Institute (BFI) has studied the impacts that overseas mergers and acquisitions are having on the video games industry in the UK. Rapid growth has had an "important" impact on the UK economy, supporting 76,000 jobs and making UK companies increasingly attractive to overseas businesses.

In fact, as of April 2023 mergers and acquisitions have led to more UK games industry employees working for foreign entities than local ones, with 51.9% of video games development staff now employed at companies owned by overseas entities.

Into the numbers

Between 1993 and 2022 a total of 118 transactions took place involving overseas buyers purchasing UK video game developers. The US accounted for 49% of transactions while China followed at 15%. Swedish companies represented 10% of overseas acquirers - the third most prevalent.

Deals accelerated in frequency and value between 2018 and 2021 with 39% of transactions taking place in this period, while the pandemic years 2020 and 2021 specifically were the two greatest in published value at $2 billion and $2.7 billion.

Among the UK companies bought in excess of $1 million were Codemasters, Sumo Group and Playdemi.

Overseas purchasers between 1993 and 2022 were predominantly poised in the games sector and 56% were publishers. The BFI report suggests mergers with and acquisitions of UK-based developers took place primarily to bring IPs and development in-house, but noted the risk of reduced innovation and collaboration opportunities for UK firms despite the upsides.

"Mergers and acquisitions have had a range of positive and negative impacts for the UK video games industry. Acquired studios, for example, may have benefited from improved access to capital and broader distribution reach allowing them to expand at a faster rate than if they had remained independent," the BFI stated.

"However, the cost to this may have been the loss of creative autonomy or the transfer of profits and intellectual property (such as games brands) overseas."

The BFI has also spearheaded the Screen Culture 2023 initiative to promote video game preservation.