Grand Theft Auto company Take-Two is acquiring FarmVille company Zynga for $12.7 billion, the company announced on Monday morning. This is a combined cash and stock deal.
In a news release, Take-Two said this is a “transformative combination” of companies that makes Take-Two “one of the largest and most diversified mobile game publishers in the industry.”
“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,” Take-Two CEO Strauss Zelnick said. “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. As we combine our complementary businesses and operate at a much larger scale, we believe that we will deliver significant value to both sets of stockholders, including $100 million of annual cost synergies within the first two years post-closing and at least $500 million of annual Net Bookings opportunities over time.”
Take-Two clearly sees a lot of upside here, as the $9.861 per share that it paid for Zynga represents a 64% premium on Zynga’s closing share price on January 7.
Zynga CEO Frank Gibeau, a former executive at Electronic Arts, said joining forces with Take-Two allows the company to “further advance our mission to connect the world through games while achieving significant growth and synergies together.”
Take-Two will hold a conference call at 8 AM ET today, January 10, to discuss the acquisition–keep checking back with GameSpot for more.
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