Electronic Arts to acquire Titanfall maker Respawn for as much as $455 million
Electronic Arts announced it will acquire Titanfall maker Respawn Entertainment for $315 million in cash and stock, plus a possible bonus of $140 million. The deal could bring a new long-term franchise into the fold for the big third-party publisher of video games, giving EA an edge in the multibillion-dollar first-person shooter genre with properties such as Titanfall, Battlefront, and Battlefield.
The total purchase price could hit $455 million if Respawn hits its incentive targets, known as an earnout. The deal includes $151 million in cash, $164 million in restricted long-term stock grants for Respawn, and a variable earnout up to $140 million. That’s a lot of money, and it shows what is at stake as EA lines up franchises that could pay off for years to come. It also shows how high the stakes have become in the $108 billion game industry, as you would think that a company like Respawn would be able to exist as an independent game studio.
In an interview with GamesBeat, Vince Zampella, CEO and cofounder of Respawn, said, “We have worked together a long time from the inception of the studio. [An acquisition] has come up from time to time. The question was, where we are in the industry, how do we take the next step in making bigger, better games. We see the need for bigger resources to make bigger games.”
EA executive vice president Patrick Soderlund said in an interview that he echoed Zampella’s view.
“We want to have the best games. We have a good relationship,” Soderlund said. “The creative freedom is still here: DICE, BioWare, our studios have creative freedom and creative integrity. That’s what gets those studios to make great games.”
The move will enable EA to more tightly coordinate with Respawn on the development and release of games. Last year, sales of Titanfall 2 reportedly suffered because it was released too close to the debut of Battlefield 1. That DICE shooter debuted on October 21, and EA published Respawn’s Titanfall 2 on October 28.
Meanwhile, EA and Respawn said today that Respawn is making a new title in the Titanfall franchise, a game set in the Star Wars universe, and a VR gaming experience without a title. Zampella said the Star Wars game is “coming along fantastic.”
The Respawn Star Wars game is significant in part because EA just shut down the 70-person Visceral Studios in Redwood City, California, and reassigned its work to a studio in Vancouver, Canada. Amy Hennig, co-creator of the Uncharted series, joined EA to work on that game, but that project is under new leadership. Asked if that was a concern, Zampella said no. And Soderlund said the closure of Visceral and the purchase of Respawn are not related.
“That was a creative decision,” Soderlund said, referring to it was related to the creative process in making a game..
But Zampella said the reminder is that Respawn has to be successful in its games and think of more ways to be even more successful. He said fans shouldn’t worry that the acquisition will change anything.
“For fans, my message is we are still Respawn and we are going to make things better,” Zampella said. “It doesn’t change the future of Titanfall. Only positives come from it, like more resources.”
Respawn is building a non-Titanfall, non-Star Wars game for the Oculus Rift VR headset, and both Zampella and Soderlund said there is no change in that deal.
Asked if Respawn was dragging EA into VR, Soderlund said he did not feel that was the case.
“We are big believers in the medium and the immersion and what VR can do,” Soderlund said.
https://venturebeat.com/2017/11/09/elec ... nment-455/
