Take-Two to purchase Zynga in $12.7 billion cash-and-stock deal

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Take-Two Interactive Inc. The Zynga Inc. in a $12.7 billion deal that would give the videogame publisher greater exposure to the mobile-gaming business.

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deal for Zynga ZNGA,
-1.48%
This would include a mix of cash and stock, Take-Two TTWO,
-0.01%
said in a press release on Monday morning. The company intends to pay $3.50 in cash and $6.36 in Take-Two shares for each share of Zynga.

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Zynga’s stock was up 52% ​​in premarket trading. Take-Two shares were off about 9% premarket.

Take-Two said in its press release that the merger would make it one of the largest mobile-gaming publishers, and it called mobile games “the fastest growing segment of the interactive entertainment industry.”

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Publishes games like Zynga farm Ville And Empires and Puzzles, while Take-Two is known for powerhouse titles, including grand theft auto And red Dead Redemption.

Take-Two expects to see annual cost synergies of about $100 million in the first two years after the deal closes. It also sees the potential for “annual net bookings of over $500 million opportunities over time”.

“As we combine our complementary businesses and do much more”
By and large, we believe we will deliver significant value to both sets of shareholders,” Take-Two Chief Executive Strauss Zelnick said in the release.

Take-Two further noted that through “best practices and the sharing of key data insights”, it “expects to benefit from significant growth and publication synergies, unlock new revenue streams and reach new audiences around the world”. Is.”

The company estimates that the deal will close in the first quarter of its 2023 fiscal year, which ends in June 2022.

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