Atari 50
Image: Atari

Atari has announced its intention to purchase Digital Eclipse, the studio responsible for such titles as Street Fighter: 30th Anniversary, SNK 40th Anniversary Collection, Teenage Mutant Ninja Turtles: The Cowabunga Collection, Atari 50: The Anniversary Celebration and The Making of Karateka.

"The acquisition of Digital Eclipse will allow Atari to expand its internal development capabilities and utilize Digital Eclipse’s industry-leading experience and proprietary technology," reads the press release. "In joining Atari, Digital Eclipse will grow its business and capabilities by expanding its development capacity and access to world-class IP and will leverage Atari’s management expertise."

Founded in 1992, Digital Eclipse has overseen more than 250 releases during its lifespan and has recently gained a solid reputation when it comes to preserving retro games for future generations. The acquisition will see the company join Nightdive Studios, another firm focused on remastering classic games which Atari purchased in May of this year.

The deal consists of an initial consideration of US$6.5 million, payable at the closing of the acquisition. This is made up of US$4.0 million in cash and US$2.5 million in newly issued Atari ordinary shares, as well as a remaining earn-out of up to $13.5 million, which will be payable in cash over the next ten years, based on the future performance of Digital Eclipse. The deal is expected to close in the next few days.

Digital Eclipse has calmed fears that it will no longer have the freedom to work with other publishers as a result of this deal. "It is business as usual at Digital Eclipse," it said in its own statement. "While we're certainly happy to have greater access to Atari's fantastic library, we still have the freedom to seek out projects with other parties."

Wade Rosen, Chairman and CEO of Atari, had this to say about the purchase:

Digital Eclipse is the best in the world at what they do. They have a deep love and respect for the history of the games industry, and are renowned for developing critically acclaimed projects based on historic franchises. Digital Eclipse, along with Nightdive, are in perfect alignment with Atari’s DNA and renewed purpose. I’m personally excited to see where we can push the boundaries of retro innovation together.

Mike Mika, President and Creative Director, added:

Our experience collaborating on Atari 50: The Anniversary Celebration was revelatory. The trust that Atari showed our team, and our clear mutual love and respect for the content, positioned us to produce something truly remarkable. I know Atari will continue to champion our approach and that we will be bringing fans exciting new projects for years to come.

Atari has gone on something of a purchasing spree lately; in addition to Nightdive and Digital Eclipse, it has also bought MobyGames and Atari Age in 2023.

The company has also given renewed focus to its back catalogue by releasing new physical cartridges for the Atari 2600 and producing an all-new version of the console with hardware partner Plaion.