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Rumour: Bigpoint is for sale for $300-$400 million – is a wave of consolidation coming?

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April 29, 2010 |

The Financial Times has reported a rumour that German browser game company Bigpoint has appointed investment bankers and is considering a sale.

Bigpoint logo

The report (written by Mergermarkets, a news service aimed at investment bankers, and behind a registration wall), says that US-based investment bank Montgomery and Co. has been appointed to “to explore strategic alternatives following strong inbound interest”.

The report says that Bigpoint had revenues of €26 million in 2008 and €10 million in 2007, although that’s quite a long time ago in online games terms. I would expect those revenues to at least have doubled by now.

Bigpoint is owned 70% by GMT and Peacock Equity (the private equity arm of NBC Universal) and 30% by CEO Heiko Hubert.

With Playfish selling last year, Bigpoint rumoured to be on the block and bankers sniffing around other European online games business, is the market about to see a wave of consolidation?

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  • Stan Beremski

    Nicholas,

    What would you say are major synergies that you might expect from consolidation between online games companies?

    [Reply]

    Nicholas Lovell Reply:
    May 4th, 2010 at 5:16 pm

    The biggest cost for a social games company in the future will be customer acquisition. The era of free viral growth is pretty much over. So the key synergy will be reduced customer acquisition cost.

    You can either view it as lower CPA for individual games (because you can pass players from one game to another as they tire of the first) or as an increase in LifeTime Value of a customer (because they stay within the company's portfolion of games).

    Then there are standard synergies (head office, finance function, HR, etc) and some technical costs (one billing team, one fraud prevention team, one database management team etc).

    But marketing is the biggie, I think

    (SHould we have a more detailed chat? nicholas@gamesbrief.com if you are interested)

    [Reply]

  • Stan Beremski

    BTW the fConnect button doesnt work…

    [Reply]

    Nicholas Lovell Reply:
    May 4th, 2010 at 5:13 pm

    How odd. It works on other posts. I'll look into it.

    [Reply]

    Stan Beremski Reply:
    May 5th, 2010 at 11:14 pm

    It doesnt work on other posts for me either…. I am using Google Chrome 4.1.249.1064 (45376)

    [Reply]

  • http://twitter.com/Vlado_BA_SK Vlado

    My experience with Bigpoint is very bad. You can read it at: http://www.mydarkorbitexperience.com

    [Reply]

  • Pingback: Big Point goes from €10 to €200 Million Income in 4 Years « A Great Becoming…

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