Games-maker Activision Blizzard has announced it will spend US$5.9 billion to acquire King Digital Entertainment, the evil genii behind Candy Crush.
Moving into mobile is the reason for the deal: Actvision CEO Bobby Kotick says, in his canned statement, that “Mobile gaming is the largest and fastest-growing opportunity for interactive entertainment and we will have one of the world's most successful mobile game companies and its talented teams providing great content to new customers, in new geographies throughout the world.”
Is King really a prize? The company points to “340 million average monthly unique users, as of second quarter 2015, across web, social and mobile platforms.” Those thumb-sore addicts customers aren't just playing Candy Crush: King's court is also home to Farm Heroes, Pet Rescue and Bubble Witch, among 200-odd games.
King also helpfully explains its modus operandi, as follows:
We make our games available for free, while players can purchase virtual items priced relative to the entertainment value they provide. We embed social features in our games that enhance the player experience. We also build on a unique and passionate company culture predicated on collaboration, humility and respect. We believe all of these elements in combination have made our games a great part of our players’ daily entertainment.
Such a great part that the listed company's shareholders are going to receive $18 a share, a 20 per cent premium on King's share price at the time the deal was announced. That premium will not satisfy all King's shareholders, as the company's 2014 IPO didn't go well. Its opening price of US$22.50 was more-or-less rejected and the stock settled at $19 on opening day. It's seldom reached that level since, making $18 a decent exit for plenty if investors. ®