US-headquartered video game developer Epic Games closed a $1bn funding round featuring a $200m investment by consumer electronics manufacturer Sony, valuing it at $28.7bn.
Sony was joined by investment and financial services group Fidelity, Appaloosa, Baillie Gifford, GIC, Ontario Teachers’ Pension Plan Board, Park West, KKR, AllianceBernstein, Altimeter Capital, Franklin Templeton, Luxor Capital, funds and accounts advised by T Rowe Price and funds and accounts managed by BlackRock.
Epic specialises in multiplayer online games using its Unreal Engine, and its most famous titles are battle royale game Fortnite and first-person shooter series Gears of War.
The company is looking to build a ‘Metaverse’ of games, having acquired multiplayer sports title Rocket League by buying its developer, Psyonix, in mid-2019 and agreeing last month to buy another studio, Tonic Games, the creator of battle royale platformer Fall Guys.
Sony put up $250m for Epic’s last round, which closed at $1.78bn in August 2020, valuing it at $17.3bn post-money.
Fidelity, Baillie Gifford, Lightspeed Venture Partners, Ontario Teachers’ Pension Plan Board, KKR, Smash Ventures and David Tepper also contributed to the August round, along with funds and accounts managed by BlackRock and funds and accounts managed by T Rowe Price.
Epic had secured $1.25bn from esports team owner Axiomatic, KKR, Smash Ventures, Lightspeed Venture Partners, Iconiq Capital, Vulcan Capital and Kleiner Perkins in 2018 at a reported valuation close to $15bn.
Internet group Tencent supplied $330m for the company in 2012 in return for a 40% stake. Its earlier backers include media and entertainment conglomerate Walt Disney and talent agency Endeavor.
Founder and chief executive Tim Sweeney remains the company’s controlling shareholder. He said: “We are grateful to our new and existing investors who support our vision for Epic and the Metaverse.
“Their investment will help accelerate our work around building connected social experiences in Fortnite, Rocket League and Fall Guys, while empowering game developers and creators with Unreal Engine, Epic Online Services and the Epic Games Store.”
Sony president, chairman and CEO Kenichiro Yoshida added: “Epic continues to deliver revolutionary experiences through their array of cutting edge technologies that support creators in gaming and across the digital entertainment industry.
“We are excited to strengthen our collaboration to bring new entertainment experiences to people around the world. I strongly believe that this aligns with our purpose to fill the world with emotion, through the power of creativity and technology.”
Credit Suisse and BoFA Securities were joint placement agents for the round while Wilson Sonsini Goodrich & Rosati were legal counsel for Epic.
