Zeus Capital leads on £145m Sumo IPO and £78m combined fund raising

Sumo Group to float for £145m

Sumo Group, the independent game developer, announces its £145m AIM IPO.

The transaction saw strong support from institutional investors, including two successful share placings undertaken by Manchester-based Independent investment bank, Zeus, raising a combined total of £78m.

Sumo Group provides creative and development services to the video games and entertainment industries, and has provided co-development solutions to global developers and publishers including Microsoft, Sony, Sega and IO Interactive.

Founded in 2003, the business employs more than 450 across its headquarters in Sheffield, Nottingham and India.

In June this year, Sumo added to its offering with the acquisition of Atomhawk, a visual design company, servicing the games, film and visual effects industries.

The firm recently expanded its offering to generate its own intellectual property, launching Snake Pass in March 2017 across all major consoles. This has sold more than 170,000 units since release, and generating an 83% return on investment.

Following the transaction, Sumo plans to use the funding to support its organic growth strategy. This includes further development of new franchise titles and adding downloadable content for existing titles, either on solo projects or in collaboration with other developers and publishers.

The deal sees the company’s owner, Perwyn LLP, retain a substantial shareholding of the company on admission. The private equity house has been the majority shareholder at the firm since September 2016, following a secondary buyout from NorthEdge Capital.

Carl Cavers, founder of Sumo Digital and CEO of the company, said: “We are delighted to announce our intention to float on AIM. This is a significant step forward in Sumo’s journey to become a global leader in premium development and creative services to the video game and wider entertainment industries. We have had an overwhelmingly positive response to the IPO, which has been very well supported by blue chip institutional investors. 

“Our people are our business; we believe our teams are very well positioned to lead the way in one of the world’s most exciting creative industries. Being a quoted company in a fast-growing tech sector will, we believe, allow us to execute our strategy, whilst continuing to put quality and creativity at the forefront of the products and services we deliver.” 

Richard Darlington, director of corporate finance at Zeus Capital, said: “Sumo Group has shown an ability to offer a full end to end service in a rapidly growing marketplace, investing heavily in its leading technology and creative solutions to produce high quality output for its blue chip customer base. As a result, the company is ideally placed to thrive on AIM, and is well positioned to benefit from the growth in demand.

“This has been another outstanding Northern deal for the Zeus Capital team, following similar recent successes on Tatton and Strix. As a result, the firm is ranked second by funds raised on AIM in 2017, building on our strong track record on the market in recent years. Our transactions this year have shown that there is significant opportunity for growth following a listing, and we look forward to working with Carl and the team to unlock this in the coming months.”

Grant Thornton and Addleshaw Goddard provided advisory services to Sumo Digital, while Zeus Capital was advised by Eversheds on the transaction.