Game maker Take-Two is taking over Zynga for $ 12.7 billion

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The game manufacturer Take-Two Interactive has signed a takeover agreement with the mobile game specialist Zynga. As Take-Two announced on Monday, Take-Two plans to acquire all of Zynga’s outstanding shares for $ 9.861 each. Of this, $ 3.50 per share should flow in cash, the remainder should be settled with common shares of Take-Two. In the deal, Zynga is valued at $ 12.7 billion, roughly EUR 11.2 billion.

For the purchase price, both companies used the closing price of Zynga shares on January 7th with a premium of 64 percent. With the merger of the two game manufacturers, Take-Two assumes that it will be able to significantly reduce costs and achieve synergy effects. Take-Two expects to save around $ 100 million annually in costs.

In addition, Take-Two is responsible for Zynga’s mobile titles and the associated exploitation rights. The mobile games are intended to complement Take-Two’s portfolio of console and PC titles. In addition, there is the possibility of bringing the successful game titles to other platforms, as Take-Two explains in a message. To this end, they want to combine the knowledge and skills of the developers from both companies. Overall, with the merger with Zynga, Take-Two wants to penetrate the rapidly growing mobile games business and expand its own position in the games market.

According to the company, the shareholders of Take-Two and Zynga should benefit from the deal due to the expected synergy effects and the improved financial profile. Take Two shareholders will then hold between 67.2 percent and 70.4 percent and Zynga shareholders between 29.6 percent and 32.8 percent of the combined company.

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The agreement between Take-Two and Zynga provides for the transaction to be completed by the end of June 2022. However, the purchase is not yet dry. A “go-shop” clause provides that Zynga and its board of directors have the opportunity to seek alternative offers from other interested parties within 45 days of signing the agreement, ie until February 24th. In addition, the shareholders of both companies and the relevant authorities have yet to approve the deal. The board members of the companies had decided the deal unanimously.

As a game developer and publisher, Take-Two offers games for consoles, PCs and smartphones worldwide. Zynga specializes in mobile games such as CSR Racing, Empires & Puzzles and Farm Ville (2). Zynga bought competitor Peak for $ 1.8 billion in 2020.


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