US-based video gaming company Take-Two Interactive has announced a $12.7 billion merger with Zynga, one of the top game developers of social and mobile games played by millions of users.
Zynga stockholders received $3.50 in cash and 0.0406 shares of Take-Two common stock per share of Zynga common stock, as part of the merger agreement. The merger was announced by the company in January this year.
This is the second-biggest deal in the gaming industry after the Microsoft Activision Blizzard deal, which was valued at $68.7 billion. Tencent’s $8.6 billion acquisition of Finnish company Supercell in 2016 is now the third biggest deal in gaming.
These mergers also reflect the growing inclination among big gaming companies to expand their footprint in mobile gaming. The acquisition of Activision added to Microsoft’s portfolio one of the most popular online multiplayer games, “Call of Duty Mobile”, which has over 500 million downloads.
Strauss Zelnick, Chairman and CEO of Take-Two called the merger with Zynga a “pivotal step to exponentially increase our Net Bookings from mobile.”
Zelnick added mobile is the fastest-growing segment in interactive entertainment. The deal will also provide Take-Two with “substantial cost synergies and revenue opportunities.”
According to a 2021 report by Newzoo, mobile gaming generated $93.2 billion in 2021, growing at 7.3% year-on-year and accounted for more than half of the global revenue from gaming across platforms.
Zynga’s acquisition will bring some of the popular games such as Farmville, Zynga Poker, Two Dots, and Words With Friends into Take-Two Interactive’s portfolio of games that largely includes consoles and PC games under its 2K Games label such as Mafia, NBA 2K22, WWE 2K22, and Borderlands.
Frank Gibeau, CEO of Zynga emphasised that Zynga will continue to build an unparalleled portfolio of games that will reach broader markets and lead to continued growth for this next chapter of Zynga’s history.
Founded in 2007 with headquarters in California, Zynga has been one of the leading mobile game developers in the world. According to Statista, Zynga’s entire portfolio of games had 209 million monthly active users (MAU), growing sequentially at 27%, as of the first quarter of 2022.