Shopping Spree Continues
EA has offered Glu $12.50 per share in cash, and a premium of roughly 33% to its closing price on Monday. Shares of the tech business giant advanced 1.4% on the news, while Glu stock price soared 34%.
The deal is set to complete in the quarter ending June 30 this year and will take Glu’s business valuation to $2.1 billion. A number of companies showed interest last year to acquire Glu as its stock was falling behind its rivals.
“Our acquisition of Glu combines amazing teams and deeply-engaging products to create a mobile games leader with proven expertise across many fast-growing genres,” said Andrew Wilson, CEO of the company.
“Mobile continues to grow as the biggest gaming platform in the world, and with the addition of Glu’s games and talent, we’re doubling the size of our mobile business. With a deep IP portfolio and an expanding global audience, we’ll deliver more exciting experiences for our players and drive further growth for Electronic Arts.”
EA, which mostly makes sports video games, hopes to expand its casual game portfolio through this acquisition and attract more female gamers through Glu’s “Kim Kardashian: Hollywood” game.
The video game company has made several acquisitions lately thanks to its robust balance sheet, paving the way for the takeover of the UK-based video game company Codemasters for $1.2 billion in December. The deal with Codemasters is expected to close in the first quarter of this year. The US-based business titan will pay $7.98 per share for the UK video game maker.
Last year, sales of video games skyrocketed to a new record high of $56.9 billion as people were forced to stay home due to lockdown restrictions amid the coronavirus pandemic, according to the research company NPD. Global gaming revenue rose by 13.3% in 2020.
The company elevated its annual sales forecast a few days ago in anticipation of strong sales of its popular sports games, including “FIFA 21” and “Madden NFL 21.”
Several major deals were announced in the past few months in the video game industry, including Microsoft’s $7.5 billion takeover of ZeniMax Media and Embracer’s acquisitions of Gearbox and Easybrain.
Video game giant business Electronic Arts says it will buy the mobile phone business Glu Mobile for $2.4 billion, just two months after it agreed to pay $1.2 billion to acquire the British company Codemasters.
About the Author
Avi Ben Ezra is the Chief Technology Officer (CTO) and Cofounder of SnatchBot and SnatchApp (Snatch Group Limited). He leads the Group’s long-term technology vision and is responsible for running all facets of the tech business which includes being the architect of the platforms and UI interfaces.