Another Successful IPO
The mobile games developer Playtika has raised almost $1.9 billion through an initial public offering (IPO) today, giving the company a value of about $11 billion. Shares of the gaming business will make their public trading debut today.
Playtika initially issued a new prospectus where it announced details about its expected initial public offering and its plan to offer shares worth around $1.6 billion at a company valuation of between $8.6 billion and $9.4 billion. The current equity holders are offering around 50% of that figure.
“The initial public offering price is currently expected to be between $22.00 and $24.00 per share. Playtika intends to list its common stock on the Nasdaq Global Select Market under the symbol “PLTK,” the company said in a statement.
The Chinese consortium Alpha Frontier, which is a majority shareholder in the company, planned to offload 47.8 million shares for around $1.1 billion and slash its stake from 96.7% to 80%. The company’s co-founder and chief executive, Robert Antokol, will now hold a stake worth between $220 million and $240 million before IPO prices are taken into account.
Playtika says it will use the proceeds for general business purposes, as well as working capital and capital fees. Morgan Stanley and Credit Suisse lead the IPO, while Goldman Sachs, UBS, BofA Securities, Baird, Stifel, Cowen, and Wedbush Securities will also be involved.
The business generated around $1.8 billion during the first nine months of 2020, which is 28.5% more than during the same period in 2019. Around 80% of that revenue was produced thanks to Apple, Google, and Facebook.
“The industry has reached a level of maturity where the large mobile games publishers are looking to spend big on expanding, and one of the easiest ways to do that is through acquisitions. The mobile industry has reached a point where, with the right strategy, publishers are able to reliably forecast returns from successful games,” said Craig Chapple, a mobile insights strategist at a research group SensorTower.
But during that same period, Playtika’s net profit contracted by 93.8% to $16.1 million due to the $310 million remuneration payment to Antokol in two tranches of locked shares. EBITDA rose by 41.2% to $666 million over that period.
Israeli gaming company Playtika successfully sold 21.7 million new shares to raise nearly $1.9 billion and push the company’s valuation to about $11 billion.