Atari has announced a new acquisition, entering into an agreement to buy Night Dive Studios. The indie team is best known for developing the upcoming System Shock remake.
How will the acquisition be financed?
- According to the financial terms of the Night Dive acquisition, Atari will pay $10 million half in cash and half in its shares. The deal also includes a potential earn-out of up to $10 million in cash over the next three years based on the studio’s future performance.
- The acquisition is expected to close in April 2023.
- Holding company Irata, which is the main shareholder of Atari, will provide it with bridge financing for the initial payment of $5 million. To compensate for this financing, Atari will raise €30 million through issuing convertible bonds.
- The company also plans to use the amount raised to invest in the development of more than 12 games expected to come out in the next 18 months, as well as fund its future potential acquisitions.
Why is Atari acquiring Night Dive Studios?
- With this acquisition, Atari wants to leverage Night Dive’s proprietary KEX engine, which was built specifically for making retro-themed games.
- According to Atari CEO Wade Rosen, who already owns a 13% stake in the studio, Night Dive’s “proven expertise and successful track record in commercializing retro IP is well-aligned with Atari’s [retro-focued growth] strategy.”
- On top of that, Atari wants to utilize Night Dive’s expertise in publishing, optimizing, and restoring classic games.
- Night Dive Studios also noted that they “could think of no better long-term partner than Atari” considering the team wants to keep producing new and remastered titles based on classic IPs.
Who are Night Dive Studios?
- Night Dive Studios was founded in 2012 by Stephen and Alix Kick, who previously worked as artists at Sony Online Entertainment (now Daybreak Game Company).
- The company is focused on obtaining rights to abandoned old games and re-releasing them on modern digital stores. Having published over 100 titles, it eventually started producing remasters and ports.
- The list of classic games re-released with the help of Night Dive Studios includes Quake, Doom 64, Turok, Noctropolis, Blood, and Shadow Man.
- Right now, the studio is working on a full-fledged remake of System Shock, a classic immersive sym title created by Looking Glass.
- Night Dive raised more than $1.3 million on Kickstarter, and the game is now expected to come out on May 30.