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Interview: Slitherine exec talks about new merger with Matrix Games

While the PC game industry is still a viable way for developers to release game titles, it looks like the industry is moving more and more to a digital download model versus selling boxed copies of CD and DVD-ROMs in retail stores. In that kind of environment, niche titles like strategy and war games are getting less and less of a presence in stores.

That's one of the reasons behind the announcement late last week that two smaller publishers, Slitherine and Matrix Games, would be merging their companies. Both publishers have long track records in releasing strategy, war game and historical titles on the PC. Big Download got a chance to ask some questions via email to Slitherine's director JD McNeil about the merger. McNeil is now chairman of the holding company that was formed as a result of the merger of Slitherine and Matrix Games.

First, how did the idea for this deal come about?


We first discussed the possibility of this about 2 years ago, since then we have formed a pretty tight relationship which on the surface of it may seem surprising as we were technically competitors. However, through collaboration in a number of areas we stared to realize that by joining together we would have the band width, knowledge and experience to take the combined businesses to the next level. Both teams have been working so hard over the past few years that it's been difficult to look over the parapet. The merger and our combined resources will give us more time to take the business forwards.

Both Slitherine and Matrix Games have concentrated on PC game releases. Is this still going to be the primary platform that the new combined company will release games for?

Not strictly true. Matrix is by far the most prolific publisher of PC wargames in our genre and looking to the future this area will certainly not be neglected, it's the bedrock of the business. Between the two companies we have an outstanding bunch of developers, and some of them, with our support, are already looking at the possibility of taking their titles to Console. Slitherine has already been moving in that direction and are already approved Publishers for Sony, Nintendo, and Microsoft with a number of release on Mac, iPhone, PSP, Nintendo DS and Wii and we are presently nearing completion on further new console releases, on Xbox, PS3, iPhone, iPad, DSiware and Wiiware. We see growth opportunities in both PC and Console platforms for our genre and have a very aggressive release schedule that covers almost all platforms. Additionally we will be announcing some new console releases over the next few weeks.

What will the new combined company be called and who will the executives of the company be and their titles?


We have formed a new holdings company that sits above the trading companies, these will operationally remain as before with their own identities and the Directors of both Companies own stock in the Holdings Company. The operating Directorships will remain as they are at present but we do have plans to focus individuals on their specific areas of expertise. This is one of our principle objectives as it will allow each of us to do what we do best. This was simply not possible for us prior to the merger as running the day to day businesses took up almost all of our energies. The Executives are JD McNeil, Iain McNeil, David Heath, Erik Rutins, Marco Minoli and Phil Veale.

Can you go into more details on the financials of the merger? Was it a pure stock deal or was there cash as well and what is the combined company now worth?

The entire venture has been supported by Barclays Commercial Bank, London and was a complex combination of cash and stock. The intimate details are of course confidential as both companies are private corporations. Turnover for 2010 is forecast at approximately $12m but with the plans we have in hand this could easily be exceeded.

How many people will be employed in the new merged company and where will the main office be located?

The Main Offices will be as now in the US and London. Marketing and Sales operate out of Milan, Italy and we have a small studio in Edmonton, Canada. As you can see we are a truly international business. Staffing levels will not change, but by sharing tasks between both companies we will save the need, for the time being at least, to recruit. Similarly, there will be no need to relocate staff. We continue to enjoy many aspects of modern working practices and virtual communications which allow us to employ the best staff we can, irrespective of where they are located around the globe. In total the group currently employs about 25 individuals, but there are a number of outsourced services on top of that.

PC gaming is moving more and more into a digital download business model. Do you see this as becoming the primary way that the new company will sell their titles?


Matrix is already a shining example of what can be achieved with PC Digital download and over at Slitherine this has been growing in importance significantly over the past 12 months. However we already have titles released on iphone and on the Sony PSN store, with plans for further console titles that will be delivered digitally. The industry is inextricably moving in this direction and we are very well placed to take full advantage of this. However we do intend to continue with retail releases and even expand this sector of our business, but the challenges at retail in bringing wargames or history titles to the market have become increasingly difficult. Many of our titles can be slow burners and this is why our back catalog is extremely important. Sadly retail has neglected the genre and currently their shelf space is largely given over to Triple A or pre-owned product which in our view is a misguided strategy. By giving over some of their space to smaller publishers they would freshen and grow the market. Re-cycling second hand product has been and is a self-fulfilling prophecy for retail which is driving smaller publishers and even larger ones relentlessly towards digital delivery.

Will the new company continue to concentrate on strategy and war games or do you see it releasing games in other genres?


Strategy wargames and history titles are our mission and it's what our loyal customer base wants from us. We know because our focus groups and Forums tell us. However there will always be exceptions to this and our recent release, Ice Road Truckers on our HISTORY license is a top seller on the PSN store according to Sony.

Finally do you have anything else you wish to say about the new combined company?

As you might imagine we are all pretty excited by the merger and the encouragement we have had from our development teams has been outstanding and a crucial ingredient in our plans for the future. So I guess its watch this space and look out for next week's release announcements.

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