Games Workshop Group PLC (LSE:GAW) revealed that it has signed an agreement in principle with Amazon Content, a subsidiary of Amazon.com Inc (NASDAQ:AMZN), for Amazon to develop Games Workshop’s intellectual property into film and TV productions.
A statement from the games producer said Amazon will be granted the associated merchandising rights.
Amazon will start with certain development activities, such as holding preliminary discussions with writers, to facilitate the project.
Rights will initially be granted to develop the Warhammer 40,000 universe, it said.
Games Workshop said while the parties have agreed on material commercial terms, the project is dependent on and subject to contracts being agreed upon, which the pair are working towards.
As of yet, Games Workshop has made no changes to its forecasts for the year.
Overnight, the Hollywood Reporter mentioned ex-Superman Henry Cavill could be involved.
Analysts at Peel Hunt said this "is not a surprise given his passion for Warhammer" and the Amazon deal is "major news for Games Workshop and all Warhammer fans".
While Hargreaves Lansdown analysts suggested the deal could lead to significant growth for Games Workshop, outlining “It could deepen fans connections with [its] products and bring them to a wider audience”.
“Amazon’s deep pockets and its huge reach, more than 50% of British households have an Amazon Prime account, puts this in a different stratosphere,” analysts added.
Having been forced to close its doors during the pandemic, Games Workshop previously hinted that it was working on a TV series based on novels set in the game’s universe.
However, Hargreaves cited these efforts as “modest,” with the prospective Amazon deal marking a renewed effort by the group to get its characters on screen.
A surge in streaming and screen-based entertainment during the pandemic had seen the group missing out, with much of its focus having been on physical shops and events within these at the time.
After announcing that the deal was on the cards, Game Workshop Group PLC’s share price rocketed by nearly 16%, to 8490p.