Jagex Sold to Private Equity Firm for $520M

The Chinese parent company of Jagex announced today that Jagex was sold to a U.S. private equity firm called Platinum Equity for $520M. The sale shouldn't come as a surprise as Jagex's parent company has announced some time ago that they were looking to sell the company. What's surprising though is the price paid. Given Runescape's continued growth and profitability, $520M seems like a great price, as Jagex reported profits of ~$54M last year, valuing the company at only 10x earnings.

While many were worried about Jagex's future when a Chinese company bought it, not much has changed over the years. RuneScape continues to grow and reached an all time high in players last year and continues to perform well.

Update: Jagex denies being sold to Platinum, and clarifies that the $520m proposal from them is just one of many options they are exploring. (Source)

Source: Yicai Global