Longreach to exit Japanese mobile content platform
The Longreach Group has agreed to sell Japanese mobile content provider Cybird to Aeria, a listed online gaming platform, for JPY7 billion ($64 million).
The private equity firm owns a 87.2% stake in Cybird through its first fund, with the balance held by Robert Hori, the company’s president and CEO, and other co-investors, according to a filing. AVCJ Research’s records indicate that Longreach supported a management buyout of Cybird in 2007 that valued the business at JPY17.4 billion.
Aeria said the acquisition would strengthen its mobile content offering and contribute to efforts to attract more female gamers. It noted that Cybird’s Ikemen series of games – app-based love stories which allow the user to determine the outcome – have proved popular with this target market. There have been more than 17 million downloads of Ikemen apps since the series was created in 2010.
Cybird is expected to complement Aeria’s existing Liber Entertainment platform, which is best-known for A3!, a game that allows users to participate in stories focusing on young actors who are trying to establish themselves as stars. A3! has achieved five million downloads.
Cybird generated JPY9.55 billion in revenue for the 12 months ended March 2018, down from JPY10.3 billion the previous year. Over the same period, net profit fell from JPY1.73 trillion to JPY121.5 million.
Aeria, which posted JPY15.8 billion in revenue last year, expects the Cybird acquisition to help it reach JPY28 billion in 2018. The company has been on an M&A spree in recent years, building up a portfolio that covers social gaming, software development, electronic publishing, and online enterprise services.
Longreach is currently raising its third mid-market buyout fund, which has a target of $650 million. A third close on more than $400 million came earlier this year. The GP operates across North Asia, with a focus on Japan, pursuing deals in the $50 million to $250 million range. Longreach finalized its first Fund III investment in March, a carve-out of coffee shop chain Kohikan Corporation.
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