Nazara Technologies, a leading firm in gaming and sports media, is making significant advancements to bolster its gaming portfolio. On May 24, the company revealed plans to buy the last stake in its mobile gaming subsidiary, Nextwave Multimedia, along with new investments in gaming-focused venture capital (VC) firms and an informal gaming studio. This strategic move aligns with founder Nitish Mittersain’s vision of the gaming business becoming the company’s main expenditure source in the future.
Full Purchase of Nextwave Multimedia
At first, Nazara bought a major percentage in Nextwave Multimedia in 2018, which rose to 71.88% by May 2023. The recent decision involves purchasing the outstanding 28.12% stake for Rs 21.63 crore from founders PR Rajendran, R Kalpana, and PR Jayashree. The purchase will occur in two stages: the first stage includes buying a 3% stake for Rs 2.3 crore in cash, followed by the second stage of buying the outstanding 25.12% stake for Rs 19.33 crore, either in cash or through stock issuance within six months of the first stage’s completion.
After finalizing this acquisition, Nazara plans to almagate Nextwave Multimedia and its intellectual property (IP) into the parent company, aiming to leverage synergies and capture cash flows at the parent level. This strategic approach is intended for both existing and future gaming IPs.
Revitalizing Nextwave Multimedia
Founded in 1995, Nextwave Multimedia is best known for its World Cricket Championship (WCC) franchise, the top mobile cricket simulation game. Over the past year, Nazara has revitalize Nextwave’s operations, focusing on ad monetization, live operations, brand sales, and patron purchase. Christopher Franklin, an industry veteran, was appointed CEO, succeeding founder Rajendran, who now serves as board chairman.
Nextwave’s WCC games have gotten over 100 million downloads, with about 8.1 million monthly active patrons as of Q4-FY24, and 1.1 million daily active patrons. The studio is looking to enlarge the WCC empire and launch new games, with the first expected in Q1-FY25. Recently, Nextwave also bought the IP rights for “UTP – Ultimate Teen Patti,” a popular freemium card game, further diversifying its offerings.
Investments in VC Firms and Casual Gaming Studio
Nazara Technologies is also expanding its investment portfolio by funding global gaming-focused VC firms Play enterprises and F4 Fund. The company plans to fund up to Rs 16.6 crore ($2 million) in Play Ventures’ third fund and Rs 2.1 crore ($250,000) in F4 Fund’s first fund over the next three to four years. Play Ventures, based in Singapore, focuses on early-stage gaming studios and has invested in prominent companies like Mobile Premier League (MPL) and All-Star Games. F4 Fund, based in the US, supports ventures in AI, SaaS, social, and consumer technology.
Additionally, Nazara received board approval to fund up to Rs 2.1 crore ($250,000) in Pixode, an informal gaming studio with offices in Israel, Ukraine, and the UK. Pixode has developed games like SoliTown and Soul Battles, which blend puzzle and multiplayer elements.
Nazara Technologies’ strategic initiatives are supported by strong financial accomplishments. The company came up with Rs 760 crore from notable investors, including Zerodha co-founder Nikhil Kamath, ICICI Prudential MF, and SBI Mutual Fund. Combined with its subsidiaries, Nazara raised a total of Rs 950 crore in FY24.
The company is active in three primary sectors: gaming (featuring titles such as World Cricket Championship, Kiddopia, Animal Jam, and Classic Rummy), esports (via Nodwin Gaming and Sportskeeda), and advertising (through Datawrkz). In FY24, Nazara achieved an expenditure of Rs 1,138 crore, marking a 4.3% rise from the last year’s Rs 1,091 crore. Net dividend climbed by 21.8% to Rs 74.75 crore, while the dividend from ongoing operations grew by 41.2% to Rs 89.5 crore.
Nazara Technologies’ complete purchase of Nextwave Multimedia and its strategic investments highlight the company’s dedication to raising its gaming business. By fully integrating Nextwave and enlarging its funding in global gaming ventures, Nazara aims to enhance its market presence and drive future revenue growth. These initiatives reflect Nazara’s ambition to be a top giant in the gaming industry, leveraging innovation and strategic partnerships to achieve long-term success.
