Videogame developer Team17 Group has snapped up rival Yippee Entertainment for £1.4 million, the company has announced.

The Yorkshire-based company behind the popular Worms series added the deal would allow Team17 to increase studio capacity and gain access to a new talent pool in the North West of England.

Yippee, which is based in MediaCityUK in Salford and run by industry veteran Mike Delves, will now work with Team17 on new games and projects as part of the deal.

Bosses added the £1.4 million takeover will be made up of £922,407 in cash and shares in Team17 worth £433,200, with a three-year lock-in period, meaning the shares cannot be sold until 2023.

Debbie Bestwick, chief executive officer of Team17 , said: “MediaCityUK is a wonderful location for our second UK studio and the acquisition of Yippee allows us to accelerate our recruitment plans in the North West.”

At its last set of results, Team17 saw pre-tax profits jump to £10.4 million for the six months to June, from just £31,000 over the same period last year.

The games developer saw profits surge after revenues almost doubled to £30.4 million on the back of a mix of new launches and a solid performance from its back catalogue of titles.

Team17 said that 74% of the group’s revenues came from its back catalogue, with a “solid selection” of third-party releases planned for the second half of the year, and plans to grow the business further by expanding its studio site.

Simon Neville is PA City Editor.