Take-Two, the ‘Grand Theft Auto’ parent, has announced the acquisition of the mobile game giant Zynga in a $12.7 deal. After the news broke, Zynga stock (ZNGA) soared by over 50% in the pre-market trades.
The deal- worth $12.7 billion is the biggest ever in the games industry and will see the combination of Take-Two’s console and PC franchises with Zynga’s popular social gaming brands. The games from Take-Two will include GTA, Borderlands, NBA 2K, and Bioshock, to name a few, while Zynga’s games are FarmVille and Words With Friends.
After the news of the deal broke, Zynga stock rocketed in pre-market trade. The stock which had previously closed at $6.00, down 0.90 points (-1.48%) surged to $9.19, up 3.19 points (+53.17%) on January 10 at 7:58 am (pre-market).
Zynga has more than 183 million monthly active users. According to Take-Two, the deal would establish Take-Two as “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,”
said Strauss Zelnick, chairman and CEO of Take-Two.
After the acquisition, Strauss Zelnick will continue serving as Chairman and CEO of Zynga. However, Take-Two will lead the combined company. Zynga will also look after Take-Two’s mobile ventures after the deal, which will include the T2 Mobile Games business operating under the Zynga brand as Take-Two’s label within the company.
“Combining Zynga’s expertise in mobile and next-generation platforms with Take-Two’s best-in-class capabilities and intellectual property will enable us to further advance our mission to connect the world through games while achieving significant growth and synergies together. 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.”
Frank Gibeau, CEO of Zynga, added.
While Zynga’s stock soared, on the contrary, Take-Two’s stock dipped. Take-Two stock (TTWO) that previously closed at $164.60 was trading at $147.00, down 17.60 points (-10.69%) in the pre-market trade.