Keywords Studios PLC (AIM:KWS, OTC:KYYWF), the international technical and creative services provider to the global video games and entertainment industries, has acquired Digital Media Management (DMM), a leading full-service social media agency based in Los Angeles, for an initial consideration of US$67.5mln (£54.8mln).
Founded in 2010, DMM has won awards for its work in social media marketing and has built an impressive client base in the US entertainment and video games sectors.
The acquisition gives Keywords Studios access to DMM's expertise in integrated social media strategy, management, creative and influencer solutions, plus a client base that includes Hollywood movie studios, streaming platforms, video games publishers, entertainment brands and public figures.
This is particularly valuable given the increasing convergence between the video games and media and entertainment sectors, with more crossover of content and brands between the two.
The acquisition also gives Keywords access to DMM's proprietary software Creator Lab and 11,000 square-foot production studio that will allow it to create original social media content and experiential activations to support its clients' marketing efforts.
DMM has experience in social and short-format video assets, community management, YouTube management and content creator partnership services, all of which complement Keywords' longer trailer format content expertise.
Keywords’ acquisition of DMM comprises US$57.4mln in cash and US$10.1mln in shares on completion plus a maximum deferred contingent consideration of US$32.5mln payable in a mix of cash and new ordinary shares depending on the future performance of DMM over the two years from completion.
Keywords will partially draw down an existing revolving credit facility to pay for the cash consideration.
“With the ever-increasing convergence of entertainment and video gaming, we believe that delivering DMM's social media marketing expertise to our clients will enable them to enhance their engagement with their player base,” said Keywords’ chief executive Bertrand Bodson.
DMM head Luigi Picarazzi commented: “We are excited by the opportunity to join Keywords, which will extend our reach and support us in the next stage of our growth and development, building on our successes to date.”