Nazara eyes tax crisis-hit real money game companies

economictimes.indiatimes.com:

Nazara Technologies is considering the possibility of acquiring crisis-stuck real-money gaming (RMG) companies as they may become available at attractive valuations, at a time when they are struggling under the burden of heavy tax liabilities, chief executive Nitish Mittersain told ET.

“We see this as an opportunity, and we are also in conversation with a few of these companies,” Mittersain said.

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“But before that, as a listed company, we have to figure out how do we de-risk our investment from any past tax claims that these companies are facing at the moment,” he said. “Given that the new taxation regime transfers the liability to the player, platform providers need not worry about taxation going forward. But retrospective dues are definitely a challenge … they are nearly three times the books of these companies and we definitely cannot absorb those.”

Also read | Nazara Technologies launches game publishing arm

The RMG industry is facing a tax demand of more than Rs 1.5 lakh crore, after the government decided to levy a 28% GST on deposits made by users to play a game, instead of on the winnings.

Having garnered investments from investors like the Kamath brothers fromZerodha and SBI Mutual Fund recently, Nazara is flush with capital. It has built a war chest of Rs 510 crore and also has more than Rs 628 crore in cash and equivalents on its books.

This week, the gaming and sports media platform unveiled its publishing