Sumo Digital set to raise £70m from AIM float

SUMO DIGITAL is set to float on the stock exchange in a deal expected to raise £70m – and value the company at £140m.

The Sheffield games developer is seeking to list on London’s junior AIM market before Christmas. Its private equity owner Perwyn, which owns about 70 per cent, and three founders plan to sell shares equal to roughly half its value, raising £70m.

Sumo plans to use the proceeds to pay off some of its £54.5m net debt and fund expansion, possibly buying other companies.

Founded in 2003, the company has made games for Sega, Microsoft and others and has grown rapidly in recent years. Products include Sonic Sega All-Stars and

Little Big Planet 3 for Sony. It is currently working on Crackdown 3 for Microsoft and Dead Island 2. Sumo, which employs 477 people in the UK, Canada and India – including 300 in Sheffield – had earnings before interest, taxation, depreciation and amortisation of £6m in 2016, on turnover of £20.5m. Turnover is on target to hit £30m this year.

In November, Sumo said it planned to create 50 jobs after taking space adjacent to its Sheffield headquarters. Chief executive Carl Cavers said he expected total headcount to grow by 60 in the next year, with 50 of the new jobs in Sheffield.

The company has just hired five senior members of staff – a chief financial officer and four key operational posts.

Mr Cavers said: “Our significant growth will always be in Sheffield. We are very fortunate that South Yorkshire has a huge heritage in games which has been good for us over the last 14 years. The universities have great games courses and produce good graduates.”

Private investment company Perwyn bought Sumo last year, aiming to help it become a ‘world leader in games development’.