Nazara Technologies to buy 55% stake in Datawrkz for ₹225 crore
NEW DELHI: Gaming company Nazara Technologies Ltd on Tuesday said it has agreed to buy 55% stake in advertising technology firm Datawrkz.
The transaction valued Datawrkz at ₹225 crore (around $30 million), Nazara said in a statement, adding it will acquire an initial 33% stake by April for ₹60 crore.
Of the total amount, ₹35 crore will be paid in cash and the balance ₹25 crore in cash or a swap of shares. Nazara has an option to acquire the balance 22% in the second tranche that is expected to close in JanuaryMarch next year.
“Ad tech is now a segment for us from a value creation point of view and through organic and inorganic growth we will build this segment,” Manish Agarwal, chief executive officer, Nazara, said in an interview. The deal with Datawrkz was built on Nazara’s broader philosophy of investing in companies that are being built to last and not built to sell, he added.
There will be no management change in Datawrkz as part of the transaction.
Founded in 2013 by IIM Ahmedabad alumnus Senthil
Govindan, Datawrkz has offices in the US, India and Singapore. The company, bootstrapped so far, functions as an “independent trading desk” to power digital media strategy, planning and execution.
Datawrkz had posted a combined revenue of ₹90.7 crore (around 12.1 million) and earnings before interest, taxes, depreciation, and amortization (Ebitda) margin of 12% in calenonline dar year 2021, the statement noted.
In 2020, its revenue was at ₹37 crore, said Agarwal. The company had about 70% of its revenue coming from the US during the period, and the US is expected to remain its largest market.
The statement noted that there is an increasing symbiotic relationship between gaming companies and ad tech companies globally as a combination of the two will be value-accretive for both businesses.
“With this transaction, Datawrkz aims to establish itself as a key player in gaming, covering both demand and supply side offerings for the gaming ecosystem in the US and India,” it added.
Nazara has made multiple acquisitions and investments over the years.
Last year, Nazara acquired a stake in Rusk Media Ltd for about ₹2 crore and bought skillbased gaming company OpenPlay for ₹186.4 crore.
Earlier, it backed pre-school edutainment app Kiddopia and acquired a majority stake in video game developer Sports Unity, and multi sports content platform Sportskeeda. It also acquired eSports platform NODWIN gaming in 2018.