Indie game publisher Devolver Digital is pursuing a return to private ownership, citing a belief that its current share price does not reflect its true market value. The company, which went public in 2021, has experienced a substantial decline in its stock value, dropping by 96.27 percent from its initial valuation.
Devolver Digital stated in a press release that it has faced challenges in delivering growth in line with market expectations, attributing this to broader industry turmoil since its public debut. When Devolver Digital initially went public, it was valued at approximately $950 million (£694.6m). However, the share price has since fallen, bringing the company's current valuation to around $46.63 million (£34.64m).
The decision to go private is subject to shareholder approval, with a vote scheduled for September 8 during the company's annual general meeting. If approved, Devolver Digital anticipates becoming a private entity on September 16.
A spokesperson for Devolver Digital explained that becoming a private company is believed to be in the best interests of the company, its employees, partners, and shareholders. The aim is to allow the team to concentrate on the long-term health of the business without the constraints of satisfying public market requirements. This transition is estimated to save the company approximately $1.6 million annually.
The video game industry has faced a challenging stock market environment since the COVID-19 pandemic, which initially drove significant growth. This period has seen widespread layoffs across the industry, even impacting larger companies. Despite these stock-related difficulties, Devolver Digital has continued to publish notable titles, including "Cult of the Lamb" and "Skate Story."