I wrote for Naavik about Savvy Games Group’s $4.9 billion acquisition of Scopely. Read the full article here.

Why I wrote about this

I was quite interested in learning more about Saudi Arabia’s gaming ambitions and the PIF. This deal is one of the largest ever in mobile games and a clear signal that Savvy Games intends to buy its way into games.

The gist of it

Savvy Games Group, backed by Saudi Arabia’s Public Investment Fund (PIF), is acquiring mobile publisher Scopely for $4.9 billion. Scopely will continue operating autonomously after the deal closes.

Scopely has been around for more than a decade, but its real growth story has been fueled by acquisitions. Over the past five years, it assembled a portfolio of durable mobile titles: Star Trek Fleet Command, Marvel Strike Force, Solitaire Tripeaks, and Stumble Guys. Revenue reached $749 million in 2021 and $649 million in 2022. According to data.ai, mobile in-app purchase revenue has declined year-over-year, though the company notes that cross-platform revenue (including PC and console) keeps overall growth intact.

Savvy, by contrast, is a newcomer with enormous backing. Incorporated in late 2021 and launched publicly in 2022, it has already acquired ESL and FaceIt and invested heavily in esports. More importantly, it has a $38 billion mandate for games, with $13 billion earmarked specifically for acquiring a leading publisher. Its parent PIF is a $600+ billion sovereign wealth fund. PIF has been steadily building its gaming investments through minority stakes in companies like Nintendo, EA, Take-Two, Activision Blizzard, Capcom, Nexon, Embracer, and others, alongside majority ownership of SNK.

The $4.9 billion tag is about 10% below Scopely’s rumored 2021 valuation, but roughly 48% above its 2020 funding round valuation. Realistically, Savvy had few assets of this caliber to choose from. If the mandate is to acquire a global publisher, there aren’t many available targets. And investors who came in at a $3.3 billion valuation in 2020 were unlikely to accept a flat or down outcome. The result feels like a deal both sides can live with.

Key takeaways

  • Saudi Arabia’s gaming push is accelerating.
  • Scopely is an acquisition-driven publisher that has proven it can scale third-party IP into major revenue engines.
  • The valuation sits between 2020 optimism and 2021 exuberance. Not a fire sale, but not peak bubble pricing either.
  • Savvy has now deployed roughly $5 billion of its $13 billion M&A budget, leaving significant dry powder for more headline deals.
  • In a downturn with fewer buyers and compressed valuations, a patient, well-capitalized acquirer has real leverage.