Video game maker Sega Sammy Holdings Inc offered to buy Rovio Entertainment Oyj in a deal that values the Finland-based Angry Birds creator at about 706 million euros (US$776.34 million).
Sega offered 9.25 euros per share in cash to the shareholders and 1.48 euros per option to the option holders of Rovio, it said in a statement yesterday.
The Finnish company’s board unanimously recommended shareholders accept the offer that is backed by 49 percent of shareholders, including Rovio’s founding Hed family.
Photo: Reuters
The deal brings to close talks the Finnish mobile game maker had engaged in with multiple parties since an US$810 million offer from Israel-based Playtika Holding Corp became public in January.
Rovio on March 22 said that it had ended talks with Playtika, but continued discussions with other parties it did not identify.
Japan’s Sega is doubling down on console and smartphone gaming for long-term growth as its traditional businesses of pachinko and arcade machines face dwindling audiences and have been in hit by waves of COVID-19 restrictions in the past few years. Some of its best known titles include the Sonic the Hedgehog series, Crazy Taxi and the Yakuza series, also published as Like a Dragon.
“Among the rapidly growing global gaming market, the mobile gaming market has especially high potential, and it has been Sega’s long-term goal to accelerate its expansion in this field,” Sega chief executive officer Haruki Satomi said in the statement.
For Rovio, the famous Angry Birds franchise is the cornerstone of the Finnish company’s operations. First released in app stores in 2009, the branded mobile games generate more than 80 percent of its gross bookings. It was the first mobile game to reach 1 billion downloads, and Rovio went public in 2017 on the back of its success, with a market value of about 900 million euros.
The company’s first months on the stock exchange were characterized by dramatic slumps after its financial disclosures disappointed shareholders. The shares have never fully recouped the losses.
In its early years, the Finnish firm developed more than 50 games, typically with gloomy titles such as Darkest Fear, Cyber Blood and Wolf Moon, before striking gold with Angry Birds, an entertaining creation that capitalized on the iPhone’s touchscreen technology, new at the time.
Rovio’s reliance on the Angry Birds has worried investors, and the company has sought to expand to other brands and types of games. It has “several” new games in development and has acquired smaller rivals and games studios to grow in “hypercasual” and puzzle games.
The company calls the Angry Birds brand its “most precious asset,” bringing it discoverability in the crowded gaming market, and even generates a small slice of its revenue from licensing. Recent projects include a Netflix Inc show that followed two movies since 2016, and Rovio also generates royalties from consumer products.
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