Disney acquired FoxNext Games, a relative newcomer among Hollywood studio game divisions, as part of its acquisition of Fox for $71 billion in March 2019.
This acquisition comes on the heels of Scopely’s recent $200 million round of funding it is the first example of how the company is using its strategic financing for acquisitions with the focus on expanding its already diverse portfolio of games across new genres and intellectual properties.
As part of the deal, Scopely has agreed to buy the Los Angeles studio of FoxNext Games, which made Marvel Strike Force, and Cold Iron Studios in San Jose, California.
“We have been hugely impressed with the incredible game the team at FoxNext Games has built with Marvel Strike Force and can’t wait to see what more we can do together,” said Tim O’Brien, the chief revenue officer at Scopely, in a statement. “In addition to successfully growing our existing business, we have been bullish on further expanding our portfolio through M&A, and FoxNext Games’ player-first product approach aligns perfectly with our focus on delivering unforgettable game experiences. We are thrilled to combine forces with their world-class team and look forward to a big future together.”
FoxNext Games Los Angeles released its debut title, Marvel Strike Force, in March 2018, and it has become a strong performer on iOS and Android, bringing in more than $150 million in its first year.
The studio is also developing Avatar: Pandora Rising, a massively multiplayer strategy game based on James Cameron’s Avatar film.
The acquisition does not include the separate portfolio of Fox IP licensed games titles, which will continue to be a part of Disney’s licensed games business. Disney acquired the FoxNext Games vertical game studios and licensed games titles in its 2019 acquisition of 21st Century Fox.
“I’m extremely proud of what our talented team at FoxNext Games has built and accomplished in just a few years,” said Aaron Loeb, FoxNext Games president, in a statement. “And look forward to joining forces with the impressive team at Scopely, who have a well-deserved reputation as one of the preeminent companies in the free-to-play games arena.”
Upon completion of the transaction, Loeb will join Scopely in a newly created executive role and Rahimi will lead the FoxNext Games Los Angeles studio within Scopely as president of games.
The acquisition agreement follows a number of recent milestones for Scopely including the achievement of more than $1 billion in lifetime revenue last summer, the acquisition of Digit Game Studios, and global expansion across Europe, Asia and North America.
LionTree Advisors is acting as financial advisor to Disney, with Moelis & Company acting as financial advisor to Scopely.