Krafton Acquires Nautilus Mobile for $14M - Expanding in India

Krafton Acquires Majority Stake in Indian Gaming Studio Nautilus Mobile

Krafton, the South Korean video game company behind popular titles like PUBG: Battlegrounds and Battlegrounds Mobile India (BGMI), has finalized the acquisition of a controlling interest in Nautilus Mobile. The deal, valued at $14 million and executed entirely in cash, brings the 12-year-old Indian gaming studio under Krafton’s umbrella.

Deal Details and Studio Independence

The South Korean firm confirmed to TechCrunch that it has secured a stake exceeding 75% in Nautilus, the developer renowned for its Real Cricket franchise.

Despite the acquisition, Nautilus will maintain its operational independence. All 45 employees will remain with the studio, continuing their work under the existing payroll structure, as communicated by Krafton to TechCrunch. The transaction is anticipated to be completed by the end of the current month.

Nautilus Mobile’s Background and Game Portfolio

Established in 2013, Nautilus Mobile has achieved significant success with its Real Cricket series. Currently, the franchise comprises five distinct titles, including Real Cricket 24 and Real Cricket Premier League, accumulating millions of downloads.

Strategic Rationale and Future Plans

Sean Hyunil Sohn, CEO of Krafton India, stated that the company intends to enhance Nautilus’ core strengths in mobile cricket games. This will involve refining existing titles in the short term and exploring new game genres over the long term, capitalizing on the substantial demand within India’s cricket-loving population.

Anuj Mankar, CEO of Nautilus, explained to TechCrunch that this collaboration will empower Krafton to further its India gaming strategy. Together, they aim to develop a broader range of games, catering to both the Indian and global markets.

Krafton also plans to extend Nautilus’ reach into additional geographic regions in the future.

India’s Mobile Gaming Market Growth

India’s mobile gaming sector is experiencing consistent growth, fueled by a large and youthful smartphone user base. According to market intelligence firm Niko Partners, mobile games account for 77.9% of the country’s total gaming revenue.

Niko Partners projects that India’s mobile gaming revenue will increase from $640 million in 2023 to $1.1 billion by 2028.

Krafton’s Investment in India

Krafton reported a 119.3% year-over-year increase in net profit last year, reaching approximately $889 million (KRW 1.3 trillion). India is considered a crucial market for the company’s continued success.

Currently, the majority of Krafton’s growth in India stems from its flagship title, Battlegrounds Mobile India (BGMI), which achieved record sales and surpassed 200 million downloads last year.

While Krafton offers other titles like Bullet Echo India, Road to Valor, and CookieRun, none have replicated the success of the localized PUBG version.

Previous Investments and Rationale for Increased Control

In 2020, JetSynthesys acquired a 100% stake in Nautilus Mobile, followed by a $5.4 million strategic investment from Krafton in 2022.

Initially, Krafton’s investment was based on Nautilus’ potential. However, the company found that a minority stake limited its ability to fully support the studio’s content development. Acquiring a controlling stake will facilitate deeper collaboration and greater involvement in core development efforts.

Nihansh Bhat, corporate lead development at Krafton India, emphasized the potential of cricket games, stating the intention to maximize this market’s potential not only in India but also in other cricket-playing nations.

JetSynthesys’ Continued Involvement

JetSynthesys will remain a “significant minority” investor in Nautilus Mobile and will continue to collaborate on areas such as esports. They have previously partnered Real Cricket with teams associated with the Indian Premier League.

Bhat indicated that Krafton will measure the deal’s success by tracking increased revenue, user base, retention rates, and new partnerships.

Total Investment in India

To date, Krafton has invested over $200 million in India, excluding the Nautilus Mobile acquisition.

The company’s investments in India span gaming and related sectors, including payments platform Cashfree, audio platform Kuku FM, and influencer marketing platform One Impression. Krafton has also invested in gaming-focused funds like Lumikai and IMM Investment’s first India fund.

Sohn stated that Krafton is actively seeking opportunities for acquisitions, moderate investments, and business collaborations with key players in the Indian market.

Nautilus Mobile will now join Krafton’s network of 14 game studios operating globally.