From Game Development to M&A: The Evolving Legal Landscape of Cyprus’ Video Game Industry
Few people would associate Cyprus with the global video-game industry. Yet, over the past few years, the island has developed into a rapidly growing gaming hub, attracting companies, talent and significant investment.
According to the Cyprus Video Games Industry Reports 2025 published by the Cyprus Game Developers Association (CYGMA), more than 400 video-game companies are now active in Cyprus, employing more than 4,300 people and generating more than €3.2 billion in industry revenue in 2025. The industry has also experienced substantial growth in recent years, with the number of companies increasing from 169 in 2019 to 393 in 2024, while employment increased from 1,438 to 4,320 over the same period.
This growth, however, brings with it a more complex legal and commercial environment. As video gaming companies expand, attract investment and become involved in mergers and acquisitions, issues relating to intellectual property, employment, corporate structuring, data protection and cross-border transactions become increasingly important.
The development of Cyprus’ video-game industry therefore presents not only an economic opportunity, but also an evolving legal landscape that businesses and investors should carefully consider.
The Structure of Cyprus’ Video-Game Industry
The structure of Cyprus’ video-game industry is particularly noteworthy. According to CYGMA’s Cyprus Video Game Industry Report 2025, approximately 72% of companies in the sector have fewer than 50 employees. More specifically, 30% have between 2 and 10 employees, 41% between 11 and 50, 19% between 51 and 200, and 6% have more than 200 employees. Only 4% of companies have a global headcount of 500 or more.
The sector is also overwhelmingly focused on mobile gaming. According to the report, 82.7% of companies develop for mobile, with 57.5% developing exclusively for mobile.
At the same time, 33.4% develop for PC, 19.2% for console and 11.2% for web, while 30.1% of companies operate across two or more platforms.
The industry’s international character is further reflected in its talent requirements. CYGMA estimates that Cyprus’ 400+ game companies could theoretically absorb approximately 100–300 junior graduates annually, while the number of game-relevant graduates realistically available from Cyprus’ universities is estimated at only 10–40 per year. This gap makes international recruitment an important component of the industry’s continued development.
Investment and M&A: From Gaming Companies to Valuable Businesses
The growth of Cyprus’ video-game industry has been accompanied by significant investment and M&A activity. According to CYGMA’s Cyprus Video Game Industry Report 2025, Cyprus attracted M&A transactions with a total reported value of €2.76 billion and €137 million through financing, across 21 exits and 72 funding rounds during the period 2020–2025.
The scale of individual transactions further illustrates the increasing value of Cyprus-based gaming businesses. Among the largest transactions identified by CYGMA are the acquisition of Easybrain by Miniclip for €1.06 billion in 2025, the acquisition of Outfit7 by United Luck Consortium for €885 million in 2017, the €568 million restructuring of MY.GAMES in 2022, and the acquisition of Easybrain by Embracer Group for €566 million in 2021.
The international nature of this activity is equally significant. Capital has entered the Cypriot video gaming sector from investors and companies across Asia and Europe, while Cyprus-based companies have themselves become active acquirers. According to CYGMA, Cyprus accounted for 4.4% of global gaming M&A transactions valued above €10 million, representing 1.5% of the total value of such transactions.
These transactions demonstrate that the value of a video gaming business extends well beyond its workforce or current revenues. For an investor or acquirer, the underlying intellectual property, technology, contractual relationships, employees, user base and international operations may all form part of the value being acquired.
Internationalisation of the Sector and the Road Ahead for Cyprus
One of the defining characteristics of Cyprus’ video-game industry is its international and export-oriented nature. According to the Cyprus Video Game Industry Report 2025, almost everything produced by the industry in Cyprus is directed towards players outside the island. This international orientation has been a significant factor in the development of the local gaming ecosystem
This internationalisation creates an opportunity that extends beyond the video-game industry itself. The sector can contribute to the development of a broader technology and innovation ecosystem in Cyprus by creating high-value employment, attracting specialised talent from abroad and generating knowledge and expertise that can benefit other areas of the economy.
The economic contribution of the industry already reflects this potential. Between 2019 and 2024, the industry’s estimated contribution to Cyprus’ GDP increased from approximately €300 million to €1.15 billion, while its share of GDP increased from 1.3% to 3.3%.
As noted in the CYGMA report, the development of the industry reflects an increasingly outward-looking model of growth for Cyprus — one based on technology, creativity, skills and innovation, and capable of positioning the island not only as a place where international companies operate, but as a technology and innovation hub serving the wider region and global markets.
Conclusion
Cyprus’ video-game industry has developed from a relatively small sector into an increasingly significant part of the island’s technology and business ecosystem. The growth in companies, employment, revenues and M&A activity demonstrates the scale of the opportunity that has emerged in recent years.
The challenge for Cyprus now is to build on this momentum and create the conditions for the sector to continue growing sustainably. Developing specialised talent, attracting international expertise and investment, and strengthening the wider ecosystem supporting technology and innovation will be important to maintaining Cyprus’ position in the global video-game industry.
The growth of the sector therefore represents not only an opportunity for video-game companies, but also an opportunity for Cyprus to further establish itself as a technology and innovation hub serving both the region and global markets.
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