Two massive video game publishers just became one. Take-Two Interactive is best known for publishing massive AAA titles like Grand Theft Auto, but lately, they’ve been taking a big interest in the mobile space. To that end, Take-Two announced today that it has acquired Zynga for a whopping $12.7 billion.
Take-Two buys Zynga for $12.7 billion
Take-Two itself was valued at around $19 billion (prior to this acquisition) so that’s a serious chunk of cash to throw down! Take-Two bought all of Zynga’s outstanding shares at $9.86 per share
which breaks down to $3.50 in cash and $6.36 in shares of Take-Two common stock.
Strauss Zelnick, Chairman and CEO of Take-Two, expressed excitement over the company taking a big step into the mobile market.
We are thrilled to announce our transformative transaction with Zynga, which significantly diversifies our business and establishes our leadership position in mobile, the fastest growing segment of the interactive entertainment industry. 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. Zynga also has a highly talented and deeply experienced team, and we look forward to welcoming them into the Take-Two family in the coming months.
Zynga CEO Frank Gibeau also chimed in, predicting major growth for Zynga’s reach.
I am proud of our team’s hard work to deliver a strong finish to 2021, with one of the best performances in Zynga’s history. We are incredibly excited to have found a partner in Take-Two that shares our commitment to investing in our players, amplifying our creative culture, and generating more value for stockholders. With this transformative transaction, we begin a new journey which will allow us to create even better games, reach larger audiences and achieve significant growth as a leader in the next era of gaming.
Expanding into the mobile market
Now that Take-Two and Zynga are under the same umbrella, you can expect that they’ll be making a massive push in the mobile market. Strauss Zelnick expects $500 million in Net Bookings annually, and they’ll reach that number with mobile games in iconic Take-Two franchises. Additionally, Take-Two expects $100 million in “annual cost synergies,” which is a fancy way of saying that they’re going to trim the fat after merging. Hopefully, that doesn’t result in layoffs, as Zynga adds around 3,000 mobile-focused employees to Take-Two’s workforce.