Take-Two, publisher of renowned games such as Grand Theft Auto and NBA 2K, today announced a $ 12.7 billion deal to acquire mobile gaming company Zynga. This deal is one of the largest video game acquisitions in history, even surpassing Tencent’s $8.6 billion Supercell acquisition and Microsoft’s $7.5 billion ZeniMax Media acquisition. This is the latest in an ever-growing string of big deals in the video game industry. Take-Two announced this morning that it has struck a $ 12.7 billion deal to acquire social gaming developer Zynga.
The deal will bring together the two gaming giants: Take-Two for console and PC games and Zynga for a wide range of mobile games, a genre that has likely been widely defined by the company. The deal, the largest in the history of the industry, will create a gaming hub with a market capitalization of nearly $ 30 billion, spanning consoles, PCs, and mobile devices as more people play on their smartphones.
More or less two incredibly successful gaming companies will soon team up to make even more money. We might have to wait for some time to see the effect it will have in the long run and what the actual games will look like. Zynga will probably be serving as a gateway to mobile and social media gaming for Take-Two, allowing them to port some of its largest IPs across many platforms.
Take-Two has produced some of the biggest IP’s in gaming like GTAV, Red Dead Redemption, NBA 2K, Midnight Club, Borderlands, BioShock. The already huge library will give a new aspect to the upcoming mobile games. The companies said key opportunities include cross-marketing through a larger shared customer database and improving the gaming economy through better analytics and machine learning models. Other strategic benefits include leveraging the Zyngas Chartboost ad platform, which will improve new user engagement through more accurate audience targeting and optimize mobile ad assets for higher impact.
As part of the deal, TakeTwo said the deal will close in June and that Zynga will continue to operate as an independent company. Meanwhile, Zynga CEO Frank Guibault and publishing president Bernard Kim will oversee the integration and day-to-day operations of the combined Zynga and T2 mobile gaming businesses, which will operate under the Zynga brand as a private label under Take-Two. Take-Two will be expanding seats for its board of directors to 10 members when the deal got completed to add two members to Zyngas’ board of directors.
They called the deal a “transformative combination,” saying it would bring together “two global leaders in interactive entertainment and make Take-Two one of the largest and most diverse mobile game publishers in the industry. The companies said the “transformational” deal would save $ 100 million annually during the first two years of closure. While the deal has yet to be finalized, as Zynga has 45 days to come up with a better deal, the acquisition is likely to happen as both companies are confident enough to announce a deal this morning.
