One of the largest buyout in the gaming industry is in tow as Activision Blizzard which owns the “Call of Duty” series will be shelling out $5.9 billion total equity value for King Digital Entertainment, more than half of Microsoft Inc’s $2.5 billion purchase of Mojang previous year, Tribune reported.
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Activision Blizzard announced Tuesday, November 3, 2015, it is spending almost $6 billion to buy Candy Crush maker King Digital Entertainment, combining a console gaming power with an established player in the fast-growing mobile gaming field. Since 2003, we have built one of the largest player networks on mobile and Facebook, with 474 million monthly active users in the third quarter 2015, and our talented team has created a few of the most successful mobile game franchises.
TIME reports that the acquisition was meant to be in order for Activision to cement its position as a leader in the mobile games market.
King has focused on a business model that allows users to play a game for free, but pay extra for additional features. King’s share price has dipped since its 2012 IPO, when shares sold at $22.50 each.
“So far, Candy Crush has remained a steady performer, ranking third in the Apple app store’s top-grossing games three years after its release”. The company’s revenue fell 18 percent to $490 million in the second quarter. It will also help Activision Blizzard diversify from consoles into the mobile gaming space, while giving it access to King’s 500 million monthly users.
Activision Blizzard is known for their franchises such as the “World of Warcraft”, “Call of Duty” and “Guitar Hero”.
CEO of King, Riccardo Zacconi, CCO Sebastian Knutsson and COO Stephane Kurgan said that they will continue running King independently.
Shares of King Digital have been trading in a broad range over the last couple of months. Dublin, Ireland-based King Digital has reported annual revenues of $2.2 billion, of which approximately 80 percent are from mobile games. The news also comes in light of impressive financial results by the company, fueling potential stock price rise in the forthcoming weeks as well.
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Kotich even noted how King was popular among women with 60 % of the gamers being female.
