Take-Two Interactive is buying "Farmville" creator Zynga in an $11.04 billion deal, the "Grand Theft Auto" maker said on Monday, as it looks to tap into a surge in on-the-go gaming on smartphones.
Take-Two, also known for "Red Dead Redemption", offered $9.86 per share, representing a 64% premium to the last closing price of Zynga. Zynga's shares rose about 50% in trading before the bell, while those of Take-Two fell nearly 9%.
The deal follows Electronic Arts' $2.4 billion acquisition of Glu Mobile last year as game studios look to build their mobile portfolios.
Many consumers, who were glued to their consoles during the peak of the pandemic, have now shifted to mobile gaming as they prefer to play on the go.
"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 Chief Executive Officer Strauss Zelnick said in a statement.
The equity value of the deal is $11.04 billion, according to Reuters calculations. Including debt, the deal is worth $12.7 billion.
Take-Two has received financing of $2.7 billion from JPMorgan and intends to fund the rest with cash from its balance sheet and proceeds of new debt issuance.
Take-Two expects about $100 million in annual cost savings within the first two years after completion, and more than $500 million in adjusted revenue over time.
(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)
Dear Reader,
Business Standard has always strived hard to provide up-to-date information and commentary on developments that are of interest to you and have wider political and economic implications for the country and the world. Your encouragement and constant feedback on how to improve our offering have only made our resolve and commitment to these ideals stronger. Even during these difficult times arising out of Covid-19, we continue to remain committed to keeping you informed and updated with credible news, authoritative views and incisive commentary on topical issues of relevance.
We, however, have a request.
As we battle the economic impact of the pandemic, we need your support even more, so that we can continue to offer you more quality content. Our subscription model has seen an encouraging response from many of you, who have subscribed to our online content. More subscription to our online content can only help us achieve the goals of offering you even better and more relevant content. We believe in free, fair and credible journalism. Your support through more subscriptions can help us practise the journalism to which we are committed.
Support quality journalism and subscribe to Business Standard.
Digital Editor
RECOMMENDED FOR YOU