Kunos Simulazioni Bought Out By Digital Bros

Surprising news coming out of Italy this evening as Italian Digital Bros Group have bought Kunos Simulazioni, the studio behind Assetto Corsa.

Aside from a statement only available in Italian at the moment (see translation below), concrete info on this deal is sparse right now as it is not known how this move will affect the current Kunos Simulazioni staff or the future of Assetto Corsa.

All that’s confirmed right now is that Digita Bros have acquired full ownership of Kunos Simulazioni and its assetts, including Assetto Corsa.

Based in Milan, Italy, Digital Bros is the parent company of 505 Games, the publisher that Kunos Simulazioni joined forces with to create the console versions of Assetto Corsa.

Find the (Google translated) official announcement below, details will be added to the story as they emerge.

Update: A statement from Kunos has been released here.

Digital Bros will acquire 100% of Kunos Simulations

The Board of Directors of Digital Bros, listed on the Star segment of the Italian Stock Exchange and active in the digital entertainment sector, which met today approved the signing of an investment agreement having as its object the acquisition of 100% of the capital Kunos Simulations .

The Board of Directors of Digital Bros, listed on the Star segment of the Italian Stock Exchange and active in the digital entertainment sector, which met today approved the signing of an investment agreement having as its object the acquisition of 100% of the capital Kunos Simulations Srl, Italian developer Assetto Corsa. In the same session were also identified the beneficiaries of the options of the “Stock Option Plan 2016-2026” (the “Plan”), recently approved by the shareholders, the quantities of options granted, the exercise window and the unit price subscription.

Acquisition of 100% Kunos Simulations srl

Kunos Simulations srl It is an Italian company based in Formello (RM), which has all the latest years of experience in the construction of simulators for the main Italian automotive companies. Following this experience has developed and launched during 2014 Assetto Corsa, a video game that was a great success with critics and audiences in the Steam PC versions, Sony PlayStation 4 and Microsoft Xbox One, with over 1.4 million copies sold worldwide to date. 505 Games, the division of the Digital Bros Group that deals with international publishing of video games, has during 2015 signed a publishing agreement the console versions. Assetto Corsa puts to players 150 cars, reproduced in every aspect, from the most prestigious global automotive brands such as Alfa Romeo, Audi, BMW, Ferrari, Porsche and many others. Through the use of laser scan technology, every detail of the most famous tracks in the world has been reproduced with the utmost level of accuracy making the game a true sports driving simulation. With this acquisition, the Digital Bros Group intends to grow more and more as a publisher and developer of games able to collect worldwide success and be always ready to meet the demands of an increasingly demanding public. The acquisition allows full control of the intellectual property and the opportunity for the Group to invest in the future development of new versions of Assetto Corsa benefiting from an extremely well-positioned brand in the world market for video games. The fact that the Group already owns the publishing rights of Assetto Corsa for the console version also involves synergies in terms of brand positioning and optimization of advertising investments at a time when the rights are to be held entirely by the Group.

The transaction involves the acquisition by Digital Bros S.p.A. 100% of the shares of Kunos Simulations srl entity held by the two founders Stefano Casillo and Marco Massarutto being equal, for a total nominal value of Euro 4,341,500 Euros that will be paid as follows:
EUR 1,375,000 entirely in cash on the date of execution
EUR 1,375,000 entirely in cash within one year from the date of execution;
EUR 1,591,500 by issuing 150,000 new ordinary shares of Digital Bros at a unit price of 10.61 Euro at the arithmetic mean of the shares of Digital Bros reference prices for the last six months. The issue will be subject to the approval of the Shareholders’ Meeting called for March 13.

In the absence of financial data of Kunos Simulations srl December 31, 2016, pricing was made by assuming a net assets at the same date amounted to $ 10,000, of any changes to this value will be an increase or decrease in the second installment of cash payment. Kunos Simulations srl realized during the year to 31 December 2015, the last available financial statements, revenues of 3.3 million euros and a net profit of 1.7 million euros. Shareholders’ equity at 31 December 2015 amounted to 3.1 million euros. No special form of financing has been provided for the operation which will therefore be financed through the existing credit lines and whose execution date is expected by April 30, 2017. The agreement is binding on the parties and is subject to a condition precedent the effect of any significant findings that may emerge from the due diligence process to be put in place as soon as the financial data at December 31, 2016 will be available as well as at the positive resolution of the Shareholders

GTOmegaRacing.com

  • anonymouse

    For the love of God, post the original article in Italian or link it, I can translate it properly for you and for free as it’s my first language. There are some things that are clearly translated wrong and might mean something completely different.

    • melanieuk1

      It’s on Race department, what a shame, even though they did indicate in their end of year blog that they would be expanding the team, and relocating to a bigger location, still Stefano and Gjon should team up and create the Ultimate racing sim title.

      • Brownninja97 .

        i dont mind selling out my code is rubbish anyways.

      • anonymouse

        Funny thing is that both games (or should we give them the benefit of doubt and call them “ongoing projects”?) were “sold out” without being finished.

        It’s not the end of the world. rF2 is living on (?), AC will probably live on aswell.

        If anything, it’ll become abandonware like many other games before it while developers jump ship and create something new based on the same concept (Simbin > Sector 3 transition).

        Perhaps now that they sold the entire thing, they might finally have the money to hire a PR guy so that those shameful meltdowns on the forums won’t happen again.

      • Noah Themins

        Yup, great, I forsee this turning into Need for Speed after EA bought them out.

      • Dave_E

        EA were involved with the NFS series since the very beginning. The original game was even co-developed by EA Canada.

        Original games boxart-
        http://www.mobygames.com/images/covers/l/7412-the-need-for-speed-dos-front-cover.jpg

      • Austin Ogonoski

        I should sell out for a laugh.

  • pez2k

    Potentially positive news assuming that the founders retain some control over the direction of future development – I would hope that this is an influx of funding and a vote of confidence in the quality of their planned products.

    • LogiForce

      As said in the text, all is transferred to Digital Bros but the two founders get 150.000 shares in Digital Bros worth a bit over 1.5 million euro. So they might be allowed some input as a share holder, they won’t have control anymore in a direct sense as up till now.

  • Paul Maguire

    Damn is this good or bad?

  • Noah Themins

    Unfortunately, I remember what happened to the Need for Speed franchise after EA bought them out. I am not holding out much hope for anything positive coming out of this, but who knows, maybe I will be pleasantly surprised.

    • David Wright

      EA owned the Need For Speed franchise and the developer from the first edition.

      It is not unusual for a developer to be owned by a publisher. Papyrus were owned by their publisher when they produced titles such as Grand Prix Legends and NASCAR Racing 2003.

      • LogiForce

        Still it depends on the publisher how much freedom is given to the developer, and even though Marcos and Stefano will receive shares in said publisher it isn’t going to be more than 50% of total shares of Digital Bros as far as I know. So Digital Bros will still dictate what to do, and even though I read elsewhere that Marcos said “Nothing will change”… which person or company invest 4.5 million euro without expecting a return of investment in some way?

        As with all company take overs… some big change is bound to happen when a company changes hands. Heck, even Simbin > Sector3 wasn’t an event without change.

      • Steven Shears

        EA were publishing racing sims long before these lot came around. Papyrus’s first game – Indy 500 was published by EA. And that was in 1989. Only the Geoff Crammond games (Revs and Microprose Grand Prix) existed before it. Even before NFS they’d published Test Drive and Car and Driver. Anyway nobody knows if Digital Bros will dictate anything. Hopefully they won’t. I’m concerned about the abilty to mod though but hopefully they’ll realise its importance.

  • mclaren777

    I’m surprised that Kunos Simulazioni was worth $4.6 million.

    Now I’m curious how much Studio 397 paid for the rFactor 2 rights…

    • WesleySmalls

      Didn’t ISI just outsource development?

      • mclaren777

        Yeah, you’re right. I didn’t understand the partnership until just now.

    • David Wright

      Kunos made 1.7 million Euros profit in 2015. Where else will you get this kind of annual return for an investment of 4.3 million Euros?

      • http://batman-news.com Leeman

        They’re not gonna do that year after year.

      • David Wright

        They don’t have to. If they were to make that kind of profit every year then surely they have been seriously undervalued.

  • varis11

    OMG!! How much did you say?? Was a company without a single debt?? How many employees ?? EBITDA??? Was this its goodwill?? I’m sure they studied a lot, but 4.35 MM Eur……seems really really overpriced….
    Best business of the century…for the sellers!

  • svenvangent

    Dammit this doesn’t feel good , hope they don’t downgrade the game for PS4 console .
    If they do than I can see already the door in front of me .

    • Informed01

      …and it shouldn’t. This is not good…I explained as much to Stefano Casillo, Lead Programmer in an email exchange…that their customer service was in poor shape, that they were unable to handle and deal with critism and someone(s) would be hitting the unemployment lines because of their ignorance and arrogance.

      I am sure the main people will be well taken care of…as it always is…but those below depending on work …People are losing jobs from this…and who knows what’s gonna happen from hereonin.

      I am sure there will be some fan boys of those heavily invested to try and chop this down…however imho the writing was on the wall some time ago….and it was just a matter of time…they flopped with the console and under performed and underdelieverd…maybe they just but off more than they could chew…whatever this is, imho it’s not going to be good.

      • svenvangent

        You know ……. I’m on PS4 ,
        from the moment they told us that Asseto Corsa for console would be equally with PC but that is a lie I knew which kind of thee I was drinking , but hey it got reasonable base game still with some salt in my mouth .
        Lets see what the future will bring ?

      • quf

        “Lets see what the future will bring ?”

        About console, I believe more updates with features and optimizations console users are asking in the forum.

      • svenvangent

        Great ….I can live with that

  • mooves

    I’m confused. Was it ever about the game or just the money? (The answer is now clear). I mean you negotiate licenses with the most exotic manufacturers (including Ferrari, Porsche!!!, Lamborghini) in the world as a small independent software house. Your product is awesome. People are passionate and love your product! Why do you need to sell to a software house when you’d make the same money keeping the company AND control! It’s a very sad day for sim racing.

    PS. Yes I know a company is there to make money. To me Stefano and Marco seems to have gotten the magic beans in this deal.

    • Informed01

      Yup…and is why they’re were stiffling and criticism of AC on their forums…they virtually turned into an Ian Bell overnight as they knew money was on the line here…and couldn’t have anyone pointing out day one bugs that they appear to be unable or unwilling to fix

    • pez2k

      I’m not sure it’s as simple as this – without knowing the projected income for future sales of AC it’s not so easy to say they’d be able to afford to develop what they may plan to, whereas with publisher funding it may open more doors for them. An external source investing money into the game is a good thing for its quality as they can afford to expand the team and put more work into it.

      I don’t think anyone gets into indie game development to make a million Euros.

  • Max Faz

    This means Assetto Corsa 2 Development will start very soon. New owner needs to retrive investment. I hope dlcs cost won’t be too much expensive. Until now they had a good value/price, but I think things are going to change cost wise.

  • Franklin Silva

    From
    Marco Massarutto facebook page:
    17 h ·
    Ok, let’s clarify this before it becomes the bigger flame of the year.

    By today, Kunos Simulazioni is part of Digital Bros Family, and me and Stefano by today are shareholders of Digital Bros. That’s it. We are still the founders of Kunos, we are still IN, also keeping our respective positions and responsabilities, with just few exceptions: the budget we’ll manage by now doesn’t come anymore from our personal profits, but from Digital Bros, our bigger AC fan. Keeping the same policy, strategies, DNA, development team, goals. So, if this news would not been made public, you couldn’t realize that something is changed, because – by a gamer/simracer point of view – nothing is going to change.

    The reason why this news comes like a bombshell is because Digital Bros is a listed company, therefore this kind of operation must a) kept confidential until the negotiation is over, b) go public when is done. That’s it.

    For whom are afraid that today a piece of their simracing world has gone, let me remind them that Digital Bros has published – under its label 505Games – the console version of Assetto Corsa, and it doesn’t seem to me that AC on PS4/XB1 is an arcade game: definetely it isn’t. Therefore, before to scream in any direction that “Kunos has been bought, The World is Over”, please sit down, breath and think. Because the only news you should be interested is that by today, we have more resources, time and power to do our job, even better than before.

    So: think easier, live better, stay strong. The Future is Bright.

    Have a nice weekend

    • Informed01

      …lol, and you believe that pr propganda? What did you expect him to day? We’re firing employee’s…there will even be less support, bugs will continue, with more delays in DLC?

    • RapidRefund

      Guess I posted above a little too quickly

  • Den Burnout

    Oh no. So it’s over.

    • RapidRefund

      That’s what I say! Kunos without Stefano ain’t well you know. Stefano is one of the few to compare to Geoff Crammand.

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