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Nintendo acquires Vancouver developer behind ‘Luigi’s Mansion’ series

Deal expected to close March 1

Nintendo Co. Ltd. has a new corporate sibling on the West Coast.

The Japanese gaming giant announced Tuesday (January 5) it’s acquiring Vancouver-based Next Level Games Inc. (NLG), best known for developing the second and third games in the Luigi’s Mansion series.

The B.C. gamer’s own history with Nintendo is fairly extensive.

The Luigi titles were developed specifically for Nintendo’s own consoles beginning in the 2010s.

And NLG’s own history with characters from the Mario Bros. universe stretches back to 2005 with the launch of Super Mario Strikers.

Terms of the deal were not disclosed, however, Nintendo did reveal that all of NLG’s shares are held by its owner-directors and employees.

“A number of owner-directors recently determined that the time is right for them to sell their shares and NLG therefore began exploring potential sale transactions,” Nintendo said in a release.

“Completion of the acquisition will serve to secure the availability of NLG development resources for Nintendo, including development expertise, as well as facilitate an anticipated improvement in development speed and quality by enabling closer communication and exchange of staff with the Nintendo development team.”

The acquisition is expected to close March 1.

While no price tag for the acquisition was revealed, Nintendo said the deal would have “only minor effects” on the company’s results for the fiscal year.

NLG was founded in 2002 and is currently led by CEO Douglas Tronsgard.

It’s unclear whether Tronsgard will be retained following the completion of the deal or if the Vancouver offices will be facing an expansion or contraction in terms of employee numbers.

Nintendo and NLG did not respond to inquiries from BIV prior to publication.

The deal is perhaps the most notable exit for a local gaming company since Singapore-based Garena, a subsidiary of Sea Ltd. (NSYE:SE), bought Burnaby’s Phoenix Labs in January 2020.

Phoenix Labs is best known for its flagship Dauntless title, which boasts 25 million users worldwide who battle monsters in the fantasy-set role-playing action game.

Terms of that deal were not disclosed but CEO and co-founder Jesse Houston told BIV last month that prior media reports in the US$150 million ($194 million) range were “not too far off.”

“Most gaming enthusiasts don't really have a relationship to how expensive video games are and what the normal cost to developers, and so they tend to take these numbers way out of context and draw all sorts of wild conclusions,” he said.

“I can tell you that it was the second-largest game studio acquisition after BioWare.”

Edmonton-based BioWare, one of Houston’s former employers, was sold to Electronics Arts Inc. in 2007 in a deal worth US$860 million at the time — the equivalent to C$1.4 billion in today’s dollars.

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