(MENAFN- ProactiveInvestors)-UPDATE ADDS COMMENTS FROM CEO ANDREW DAY- Keywords Studios (LON:KWS) the video games services provider has strengthened its position in Latin America which the company has been identified as a key growth market for the coming years. Today Keywords unveiled what is expected to be an earnings enhancing acquisition of Madrid and Mexico City-based audio recording and localisation group Kite Team. Kite Team is rapidly becoming a leader in games localisation and audio recording for both Iberian and Latin American Spanish Keywords said. Group chief executive Andrew Day highlighted that in addition to Reverb a previously acquired business unit in Brazil the group now has an important base from which to grow its revenues in Latin America. Day also points to industry forecasts that say Latin America's gaming market will grow to US$2.5bn by 2018 from US$1.1bn in 2013. He describes Kite Team as 'quite a young company' but highlights that key staff are experienced in building similar businesses. Kite Team could be expected in a couple of years to have grown revenues to around €2.5mln to €3mln per year (equivalent to about 8% of Keywords group revenue in 2014). Strategically the acquisition is well placed. "It (Latin America) is a very fast growing market though it is coming up from a relatively small base" Day said in an interview with Proactive Investors. Currently worth a shade over US$1bn a year the region still accounts for a modest portion of what is an $85bn global games market he explained. "Given the size of the population in South America there's a lot of making up to do. A lot of that is going to be stimulated by smart-phone penetration and increasing adoption of games consoles." "The market is definitely growing it is wide open and most companies will now publish games in Brazilian Portuguese and Latin American Spanish as standard." Keywords is acquiring a 50% stake in Kite Team for €0.5mln in cash with the remainder subject to certain conditions. Further contingent payments could add up to €1.8mln to the deal value and payments may be made in either cash or shares. The company also told investors this morning that the wider group is performing in-line with expectations as the console game market continues to return to normal trading patterns following the 2013 launches of the Xbox One and Playstation 4. The typical seasonal ramp-up in game development activity has occurred as expected in May and is now well underway across all the group's facilities the company said. Content for video games continues to grow strongly with a particularly buoyant market for the mobile and console sectors. All of Keywords' services benefit from the proliferation of game content it added. Keywords particularly highlighted that game-art outsourcing group Lakshya acquired in October is performing very strongly. Lakshya is meeting its demanding organic growth targets Keywords said thanks to expanded capacity in the New Delhi and Pune studios as well as a new studio in Seattle Washington.
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