Take-Two Interactive announced it struck a deal to acquire mobile game developer Zynga for roughly $12.7 billion.
This is a cash-and-stock acquisition. That means Take-Two will purchase Zynga’s outstanding shares at $9.86 per share.
As a result of the deal, all of Zynga’s mobile titles will fall under Take-Two’s purview. These include FarmVille, Empires & Puzzles, and Harry Potter: Puzzles and Spells
Also, Take-Two’s board of directors will increase from eight members to 10. The two new members will be Zynga CEO Frank Gibeau and Zynga president of publishing Bernard Kim, who will oversee the merger.
The two executives will also lead the combined Zynga and T2 Mobile Games business, which will operate under Take-Two.
The deal’s success hinges on regulators giving the okay. Assuming there aren’t any hiccups, the deal will close sometime before July.
One reason for the deal is Zynga’s success in the mobile market. The company reported revenues of $705 million for its most recently reported fiscal quarter. This is a 40 percent increase year-over-year.
Another reason is presence in more countries. Take-Two plans to use the deal as a means to jump into “growth markets,” such as India and the Middle East.
Regardless of the reason, Take-Two’s planned acquisition of Zynga is the priciest video game publisher acquisition to date. This beats out Tencent’s $8.6 billion acquisition of Supercell and Microsoft’s $7.5 billion acquisition of ZeniMax.