Elevation Partners, the new private equity “supergroup”, has announced its first investment – a merger of video game developers Pandemic Studios and BioWare Corp.
Elevation, which in August closed a $1.9 billion (€1.6 billion) debut fund, agreed to invest more than $300 million in the combined company. The co-founders and senior executives of the new company will become stakeholders along with Elevation, according to a statement.
In an interview, Elevation partner John Riccitiello said his firm approached the founders of Pandemic and BioWare separately and proposed a merger and investment without revealing the identity of the other company.
Riccitiello, the former president of the world’s largest video game developer, Electronic Arts, will become an interim CEO of BioWare/Pandemic Studios.
In a statement, BioWare CEO Greg Zeschuk said the investment would “take pressure off both companies to rush games to market before their time.”
Josh Resnick, president of Pandemic, said: “Our creative, production and operational staff are as vital to our success as directors and stars are to blockbuster films, and we are giving them the stakeholder recognition they deserve. Our mutual goal is to build the industry’s best place for talent.”
Elevation Partners was founded by two former Silver Lake Partners co-founders, Marc Bodnick and Roger McNamee, former Blackstone senior managing director Bret Pearlman, former Apple Computer CFO Fred Anderson and rock star Bono, who will bring entertainment industry “domain knowledge” to the firm’s strategy, according to fundraising documents.
In March the firm initially agreed to purchase UK video game Eidos for roughly £71 million ($102 million), but the deal subsequently fell apart.
Elevation Partners has stated its intention to build companies around entertainment-related intellectual property, such as music, movies and video games.
BioWare, based in Edmonton, Canada, specialises in “role-playing” games with stories and characters. It is known for game franchises including Dragon Age and Jade Empire, as well as for games affiliated with the intellectual property of other corporations like Star Wars and Baldur’s Gate.
Pandemic, based in Los Angeles and Brisbane, Australia, is known for action-adventure video titles like Destroy All Humans.