Unity has held takeover talks with investors including Silver Lake and Saudi Arabia’s Public Investment Fund, with a valuation of about $25 billion on the table.
According to Reuters, the consortium approached the game engine outfit in recent weeks. Unity has hired an investment bank to assess its options, but no deal has been agreed, and the terms could change.
The potential buyers have barely finished their last expensive gaming purchase. Silver Lake and PIF were part of the consortium which took Electronic Arts private for $55 billion in a transaction completed in August. Buying Unity would give them ownership of software used by developers well beyond their games businesses. There is clear enthusiasm for buying the tools along with the finished products.
Silver Lake already owns about eight per cent of Unity, and its co-chief executive Egon Durban sits on the board. Reuters notes that his position would normally require him to step aside from board discussions about a sale.
The $25 billion valuation was discussed before Unity’s latest results lifted its market value to roughly $21.5 billion. Shares gained about four per cent in extended trading after the takeover report. Unity has given prospective buyers some better figures to examine. Third-quarter revenue rose 32 per cent to $622.1 million, while the company recorded its first quarterly profit under US accounting rules since its 2020 flotation.
Net income reached about $122 million, compared with a $127 million loss a year earlier. Adjusted earnings were 44 cents a share.
Its advertising business is doing much of the growing. Grow Solutions revenue rose 44 per cent to $457 million, helped by the Vector advertising platform, while Create Solutions revenue increased eight per cent to $165 million.
