Sega Acquires Relic Entertainment for $26.6 Million

Sega Acquires Relic Entertainment for $26.6 Million

by January 23, 2013

Your 2012 Bloodbath Savings at Work

It is now confirmed that Sega has purchased Relic Entertainment as part of THQ’s bankruptcy fire sale this week for some $26.6 million. The runner-up bid of $26.3 million was from Zenimax Media, according to Kotaku.

Relic is best known for its real-time strategy game development.  Their highest profile title may be Company of Heroes, first released in 2006, but there’s something more pressing Sega may have been after, and that’s the company’s expertise with the Warhammer 40,000 license, and the license itself.  Relic has developed three Warhammer 40K branded games, not counting expansion sets, and Sega announced last month it purchased the regular Warhammer video game license.  Creative Assembly were to make those games; it’s unclear now with the acquisition of Relic if that will still happen, or if Creative Assembly will take over Warhammer 40K duties, or if that line will even continue.  Court documents show the assets sold include “the business of developing, licensing, marketing and selling the Company of Heroes line,” but no mention is made of Warhammer 40K.

A letter sent to THQ employees earlier today all but confirmed the acquisition, though at the time, the price tag had not yet been made public.

While the mothership, Sega Sammy Holdings, has the pockets to fund such an acquisition, Sega itself had just finished a major restructuring less than a year in which some 130 employees across the company, or more than a third of Sega’s workforce, lost their jobs.  In an interview last week, Sega Europe COO Jurgen Post said the company’s continuing focus was on four core IP.

Earlier on, Wedbush Morgan analyst Michael Patcher speculated that $15 million may have been a more reasonable price for Sega to bite.  In an interview with VG247, he noted the IP may be more valuable to Sega than the studio workforce:

The studio can probably be kept together if Sega is willing to pay them fair wages, and Sega would essentially buy their work in progress on Warhammer (assuming Sega wants the license), Dawn of War, Company of Heroes, or whatever else they are working on.  The ‘value’ is in the intellectual property, both work in process and characters, brands and so on.

Sega already owns a well-established RTS developer in Total War maker The Creative Assembly.

If anything more comes out of this acquisition, we will let you know about it.