Date: 26 August 2007
By DOUGLAS FRIEDLI
SCOTTISH tycoons including Brian Souter, Sir Bill Gammell and Hamish Grossart are nursing big losses after the sale of a company that promised to revolutionise games on mobile phones.
Fife-based Digital Bridges, which trades under the I-Play brand, was bought by Oberon Media of New York for a sum close to $100m (£50m), with the final total dependent on how much profit it makes over the next year.
But private investors who backed the company from its early days stand no chance of making their money back because the sale price is less than the money which it raised.
Early backers such as Peter Denyer, the technology veteran, Scottish Widows chairman Gavin Gemmell and Kevin Bradshaw, who founded Digital Bridges in 1998, lost thousands on the deal. Other losers include Stagecoach founder Souter, Cairn Energy's Gammell and IndigoVision chairman Hamish Grossart, nephew of Sir Angus.
Venture capital investors Apax Partners and Argo Global Capital are also understood to have taken a hit.
Digital Bridges' board is believed to have been looking for a deal worth more than £75m but had to settle for the offer from Oberon.
Despite investors' disappointment, the deal is by far the biggest sum ever paid for a Scottish games firm. It will secure about 80 jobs at Digital Bridges' Dunfermline base which will become the centre of Oberon's mobile phone gaming operations.
Oberon is run by Israeli entrepreneurs Tomer Ben-Kiki and Tal Kerret backed by Goldman Sachs, Oak Investment Partners and Lehman Brothers.
It is a market leader in the growing field of "casual games", which are simpler, quicker and easier to play than the increasingly complex software on consoles like Microsoft's XBox. The company's research shows that two thirds of casual game users are women aged over 30, while console game users are traditionally men aged between 20 and 35.
Ben-Kiki said: "This acquisition strengthens Oberon Media's multi-platform strategy and we are now positioned as the undisputed leader in one of the hottest growth markets. We are now poised to revolutionise the casual games category, offering our partners access to more than 1,000 of the most popular casual games, delivered to their consumers' screen of choice - online, mobile and TV."
Two years ago Digital Bridges was at the centre of flotation rumours amid talk that the £10m it had just raised from Apax and Argo would not be enough to fulfil its ambition of becoming a global leader.
Last year chief executive Brian Greasley was replaced by former Nintendo executive Dave Gosen. The latter is understood to have retained his role as chief executive of the I-Play brand.
The company, which also has offices in London, Paris and California, recently struck a deal with Nokia to supply a games including World Rally Championship and Super Mah Jong for the Finnish mobile phone giant's N-Gage device.
• One of the rising stars of Scotland's computer games industry has turned publisher in order to keep more of the revenue its products generate.
Cobra, run by industry veteran Mark Ettle, will launch its Cobimobi games portal this week. Players will be able to choose from two personal computer games, Numba and Cobi Treasure Deluxe, for £12 each.
Ettle said: "We have always been constrained by the partners we worked with. We always seemed to get the smallest slice of the pie and we would be the last to get paid, even though we developed the intellectual property."
He added: "We developed Cobi Treasure Deluxe two months ago but we held back from launching the site because I really wanted to be able to offer customers more than one game."
Cobra plans to develop versions of the games for other devices such as mobile phones, Apple iPods and games consoles.
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Hamish McLeod GROSSART52 born 07-Apr-1957SPECulative Society of Edinburgh Member
A weak and bullying individual, who brings shame and unhappiness to his children,
IndigoVision
Non-Executive Chairman joined the board as chairman in 1996.Cairn Energy PLC
currently also non-executive deputy chairmanCairn India Limited
a non-executive director Member and Chairman of the Audit, Remuneration, Nomination & Corporate Governance Committees
Non-Executive Chairman joined the board as chairman in 1996.Cairn Energy PLC
currently also non-executive deputy chairmanCairn India Limited
a non-executive director Member and Chairman of the Audit, Remuneration, Nomination & Corporate Governance Committees
British Polythene Industries PLC
Deputy Chairman
Artemis Investment Management Limited
a non-executive directorScottish Radio Holdings
Royal Doulton
Deputy Chairman
Artemis Investment Management Limited
a non-executive directorScottish Radio Holdings
Royal Doulton
He has over 20 years' experience on public company boards, in a wide range of industries,
both in an executive and non-executive capacity, frequently with catastrophic consequences.
He has left:
a long trail of broken lives, betrayed staff, colleagues and women,
a long trail of broken lives, betrayed staff, colleagues and women,
who have suffered from his emotional inadequacies and lack of maturity.
A weak and bullying individual, who brings shame and unhappiness to his children,
and those who misguidedly cared for him, as he sets out to prove his worth to himself.
Always acting egocentrically at the expense of those he can bully, exploit and control.
An emotional Narcissist & a manipulative sociopath.
An emotional Narcissist & a manipulative sociopath.
