2023-11-21-牛津经济研究院-如何衡量海外并购对英国电子游戏行业的影响_89页_781kb

Summary of "HOW TO MEASURE THE IMPACT OF OVERSEAS MERGERS & ACQUISITIONS ON THE UK VIDEO GAMES INDUSTRY"

Core Content

This report, commissioned by the British Film Institute (BFI) and the Creative Industries Policy and Evidence Centre (Creative PEC), explores the feasibility of assessing the economic impact of overseas mergers and acquisitions (M&A) on the UK video games industry. It is authored by Games Investor Consulting (GIC) and Oxford Economics (OE), with the aim of providing a foundation for future research and policy discussions.

The study focuses on the consequences of overseas acquisitions of UK-based video games development studios, particularly in terms of financial performance, innovation, and market failures. It uses a combination of data sources and theoretical frameworks to identify key trends, drivers, and potential impacts of such transactions.

Main Findings and Key Insights

• Transaction Volume and Value: Between 1993 and 2022, there were 118 overseas acquisitions of UK-incorporated video games development studios. The majority of these were by existing games companies, with 56% being games publishers. The US was the largest acquirer, accounting for 49% of all transactions. The value and volume of these deals increased significantly between 2018 and 2021, with 2020 and 2021 recording the highest transaction values (US$2.0bn and US$2.7bn respectively).

• Impact on Studios: Acquired studios may benefit from improved access to capital and distribution expertise, enabling faster growth. However, there are potential downsides, such as loss of creative autonomy, reduced innovation, and the overseas transfer of profits and intellectual property (IP), which could negatively affect the UK economy.

• Data Challenges: A comprehensive and reliable dataset covering the UK video games industry over the last decade is currently lacking. However, a combination of GIC's UK video games company database, Companies House filings, and the Office for National Statistics' Interdepartmental Business Register can be used to analyze core financial impacts.

• Methodology: The most promising approach to assess the impact of overseas M&A is an econometric approach, comparing financial performance metrics (e.g., profitability, revenue growth) of acquired studios with a control group. This would allow for a more robust analysis of the effects of M&A on the industry. An event study approach based on share price data is less viable due to the limited number of publicly listed UK studios that were acquired.

• Market Failures: The report identifies four potential market failures associated with overseas M&A:

  • Reduced innovation and knowledge spillovers.
  • Relocation of production and intangibles overseas.
  • Value-reducing M&As due to dis-synergies.
  • Loss of tax revenues from overseas transfer of profits.

  Additionally, a fifth "upstream" market failure is suggested, where a lack of domestic financing options may lead studios to sell to overseas buyers under less favorable terms.

Key Drivers of M&A in the UK Games Industry

The report outlines several motivations for overseas M&A in the UK games industry:

• Access to Talent: Acquiring proven development teams to expedite product development.
• IP Acquisition: Gaining access to established game brands and their fanbases.
• Technology Transfer: Acquiring proprietary technology to reduce development risks and costs.
• Player Base Access: Leveraging existing player bases to avoid costly marketing efforts.
• Revenue Diversification: Expanding into new markets, platforms, or demographics.
• Avoiding Royalty Payments: In cases where studios and publishers are pre-existing partners, M&A can eliminate ongoing royalty pay-outs.

Data Sources and Methodological Considerations

The report evaluates various data sources for impact assessment:

• GIC's UK Games Company Database: Provides longitudinal data on development studios, including headcounts and transaction details, but lacks verification for some metrics.
• Companies House Filings: Offers firm-level financial data but is limited by inconsistent reporting standards.
• International M&A Databases (e.g., Crunchbase, Pitchbook): Contain transaction values but lack comprehensive performance data.

It also outlines two methodologies:

• Event Study Approach: Uses share price data to assess the impact of M&A announcements. However, this is limited in the UK context due to the small number of listed studios.
• Accounting-Based Approach: Compares financial metrics pre- and post-acquisition using accounts data and business registry data. This is recommended as the most feasible method for future research.

Recommendations

• Econometric Analysis: A quantitative approach using control groups to assess the impact of overseas M&A on financial performance and other metrics is recommended.
• Qualitative Research: Complementing quantitative analysis with interviews and case studies can provide deeper insights into the drivers and impacts of M&A.
• Policy Implications: If market failures are confirmed, policy interventions may be necessary to address them. The report suggests the need for further research to quantify these failures and explore potential policy responses.

Future Research Questions

• Should overseas acquisitions of UK studios be regularly tracked to monitor their impact on the industry and economy?
• What policy interventions could mitigate potential market failures if they are identified and quantified?

Conclusion

This feasibility study highlights the complexity of assessing the impact of overseas M&A on the UK video games industry. While the data is fragmented, a combination of existing databases and econometric methods can provide a clearer picture of the financial and strategic effects of such transactions. The report emphasizes the need for a more robust data strategy and further research to understand and address any market failures that may arise from these acquisitions.