Posted on: June 1, 2020 Posted by: Divine Boyle Comments: 0
Zynga Spends $1.8 Billion to Buy Peak in Its Largest Acquisition Ever
Image Credit – ft.com

Frank Gibeau, the CEO of Zynga Inc., has declared that the company is all set to purchase the Turkish mobile game developer Peak for a sum of $1.8 billion. This is the biggest acquisition of Zynga to date.

 

The deal is expected to be formally announced on Monday, and it comprises of $900 million in Zynga stock and $900 million in cash, according to what Gibeau said in his interview. It is supposed to get completed within the third quarter.

 

Buying Peak will put Zynga on the same footing as the other popular puzzle games like Toy Blast and Toon Blast. The company is ready to make this acquisition now because business is booming at this time as users are grounded at home looking for entertainment choices. The shares of Zynga have gone up by fifty percent this year, as it closed on Friday at $9.15.

 

Peak’s owners will receive 114 million shares, which are priced at$7.92, from Zynga. This is the volume-weighted average for closing over the last thirty trading days. Gibeau said that Zynga will still have $600 million in cash with it after this deal.

 

With the price tag of $1.8 billion, this deal has cost Zynga more than all its earlier transactions, which includes the 2018 deal for buying majority stakes in the Small Giant Games of Finland for a price of $560 million.

 

Gibeau expects the acquisition to increase the number of daily users for Zynga games by at least sixty percent, by expanding to the international audience. The acquisitions have been instrumental in Zynga’s growth and consequent turnaround ever since Gibeau sat at its helm as the CEO in 2016. The aim is to form an empire of the popular game to make the franchises stay in-demand for years.

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