Take-Two Interactive to buy FarmVille creator Zynga for $12.7 billion.
- Take-Two said it will acquire Zynga for $9.86 a share, a 64% premium to Zynga’s closing price Friday.
- Shares of Zynga skyrocketed 49% in U.S. pre-market trading.
- It marks the latest blockbuster acquisition in a string of major deals in the video game industry.
Take-Two Interactive is buying mobile gaming company Zynga for $12.7 billion, marking the latest blockbuster acquisition in a string of major deals in the video game industry.
The company announced Monday that it would acquire all outstanding shares of Zynga at $9.86 a share, a 64% premium to Zynga’s closing price Friday. Shares of Zynga skyrocketed 49% in U.S. pre-market trade.
This strategic combination brings together our best-in-class console and PC franchises, with a market-leading, diversified mobile publishing platform that has a rich history of innovation and creativity,” Take-Two CEO Strauss Zelnick said in a press release.
Best known for its FarmVille series of mobile gaming titles, Zynga initially flourished on Facebook, at one point becoming the most successful app developer on the platform.
In the years since, Zynga turned its focus to mobile, hoping to capitalize on the explosive growth in the smartphone era.
While the company was viewed as a key beneficiary of stay-at-home trends brought about by Covid-19, its share price has fallen nearly 38% in the past year, with some investors questioning whether the pandemic gaming boom has legs in the long term.
While FarmVille is Zynga’s most well-known game, it has published several other notable titles including CSR Racing, Empires & Puzzles and Harry Potter: Puzzles & Spells, which is based on Warner Bros.′ Harry Potter franchise.
Strauss said he expects the deal to create $100 million in annual cost synergies within the first two years after closing and potential net bookings of at least $500 million over time.
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