LONDON: Keywords Studios has announce the acquisition of Wushu Studios Limited, a leading game development studio headquartered in Liverpool, United Kingdom.

Wushu was founded in 2017, initially as an original IP studio, before transitioning to a work-for-hire model, providing a range of services to high-profile publishers and developers on co-development and full development projects as well as porting & remaster work and live support services.

Wushu employs c.160 people, with multiple project teams working closely with clients to develop a range of high-quality games. Recent titles Wushu has worked on include Fall Guys, State of Decay, Forza Horizon 5 and Baldur’s Gate 3.

Wushu has grown well despite current market turbulence, with adjusted revenues of approximately £12.5m and an adjusted EBITDA margin in line with that of the Group expected in the year ending 31 August 2024.

Wushu’s founder and majority owner Alan McDermott and his management team will remain with the business post-acquisition as they look to continue Wushu’s growth which is underpinned by a strong pipeline of high-quality projects.

The consideration comprises an upfront and earn-out component and is expected to fall within the Group’s targeted valuation range. The upfront consideration was paid in cash and funded from the Group’s existing revolving credit facility.

Bertrand Bodson, CEO of Keywords Studios, commented on the acquisition: “We are thrilled to welcome Wushu to Keywords. The acquisition aligns with our strategy to build out our game development offer globally. We now have two studios in Liverpool which is a key regional hub for talent in the UK. Wushu’s highly skilled team, strong relationships and opportunities for growth will be important assets that complement our existing Create studios as we continue to enhance our offering to our global client base. We look forward to working with Alan and the talented team over the coming years to support and drive growth in the business.”

Alan McDermott, Founder of Wushu Studios, further commented: “This is an exciting new chapter for Wushu. Joining Keywords allows us to maintain our creative independence while gaining access to a wealth of resources and expertise. It allows us to further enhance the services we offer our long-term clients with an extensive resource network and broad skillsets. Keywords shares our ambitions for continued growth, and their investment in Wushu will help us continue to remain faithful to our people-first approach to development. We look forward to collaborating with the broader Keywords network and taking on ever more ambitious projects in the future.”