The makers of GTA, Red Dead Redemption, and Bioshock (Take-Two Interactive) are in the process of acquiring the studio responsible for Farmville and Words with Friends (Zynga) for a whopping $12.7 billion.
Zynga is a gaming developer synonymous with the very popular Farmville and primarily focuses on mobile and social networking platforms with the mission statement “connecting the world through games.”
The company was founded in 2007 and has since popped out such games as Zynga Poker, Words With Friends, and Farmville. Zynga has always had the “free to play” business model and acquired its revenue through in-game purchases.
Take-Two has been said to be interested in the developer, and a merger would imply substantial income for Take-Two in the mobile gaming sector.
Take-Two announced the news with this statement from Take-Two chairman and CEO Strauss Zelnick:
“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.”
Take-Two has had its eye on the mobile gaming sector for a while now stating that mobile gaming “remains a key growth opportunity”. Zelnick himself is quoted as saying that the companies’ investments in the future would include “growing our creative teams and expanding our mobile business and expertise further.”
The acquisition will be worth $12.7 billion in cash and stock, with Zynga stockholders getting $3.50 in cash and $6.36 in Take-Two common stock for each share of Zynga common stock outstanding at closure. Take-Two is anticipating an annual cost savings of $100 billion.
The transaction is said to be finalized in the first quarter of Take -Two’s fiscal 2023, which ends on the 30th of June. Both Take-Two and Zynga stockholders must yet approve the takeover.
More mobile games will be developed based on “many of the iconic franchises within Take-Two’s portfolio of intellectual property,” according to the company. They go on to say:
“Take-Two has an extensive catalog of commercially and critically successful console and PC titles with engaged and loyal communities of players, and there is a meaningful opportunity to create mobile games and new cross-platform experiences for many of these properties.”
After the purchase is complete Take-Two’s Chief executive Strauss Zelnick will still serve as CEO.
Because this is the “biggest in the sector,” you can bet we’ll be keeping our eyes peeled for developments to bring to you, the reader, hot off the press, so stay tuned.