Activision Blizzard, Inc. (NASDAQ:ATVI) reported on Monday that it has decided to buy King Digital Entertainment PLC (NYSE:KING), the maker of famous ‘Candy Crush Saga’ game, in a transaction valued at $5.9 billion.
The deal uniting one of the biggest names in mobile gaming with Activision (ATVI), which is known for its military shooter franchise named ‘Call of Duty.’ According to research firm Digi-Capital, spending on mobile gaming titles is anticipated to reach $29 billion in 2015. Revenue from mobile games is anticipated to hit $45 billion by 2018, the research firm estimated.
Chief Executive Officer at Activision, Robert Kotick said that mobile gaming is the biggest and the rapidly-growing prospect for interactive entertainment and the company will have one of the most popular game companies in the world and its brilliant teams offering great stuff to new consumers, in new geographies throughout the globe.
King Digital, founded in 2003, depends on a business model that lets users to play games for free, though take charges for virtual goods or additional features. King has over 180 games to its name, but the most famous and all-time favourite is Candy Crush Saga, which has 158 million daily users and over 1 billion daily game plays, according to the company.
Facebook played a key role in the success of the social-gaming company, as Candy Crush Saga was primarily developed to be played on Facebook before it was rolled out for mobile phones. The game was launched in April 2012, and suddenly rose in the ranks among social games, partly helped by a mobile roll out in November 2012 on iOS operating system and on Android OS, one month later. Only one year following its launch, the game beat the flagship title from rival Zygna, FarmVille 2.
Activision will pay $18 per share that represents a 16 percent premium to the King Digital stock’s closing price yesterday.
