Take-Two announced a definitive agreement to acquire Zynga, creating “one of the largest publicly traded interactive entertainment companies in the world.” Take-Two will pay approximately $12.7 billion acquiring all of the outstanding shares of Zynga in a cash and stock transaction.
Zynga stockholders will receive $3.50 in cash and $6.36 in shares of Take-Two common stock for each share of Zynga common stock. The deal is expected to deliver approximately $100 million of annual cost synergies within the first two years after closing, and more than $500 million of annual Net Bookings opportunities over time.
“We are thrilled to announce our transformative transaction with Zynga, which significantly diversifies our business and establishes our leadership position in mobile, the fastest growing segment of the interactive entertainment industry,” said Strauss Zelnick, Chairman and CEO of Take-Two.
“Combining Zynga’s expertise in mobile and next-generation platforms with Take-Two’s best-in-class capabilities and intellectual property will enable us to further advance our mission to connect the world through games while achieving significant growth and synergies together,” said Frank Gibeau, CEO of Zynga.
In addition to securing a leadership position in mobile and greater scale, Take-Two aims to release new mobile games based on its franchises, as well as benefit from Zynga’s Chartboost advertising platform.
Following the transaction, Strauss Zelnick will continue to serve as Chairman and CEO, and the management team of Take-Two will continue to lead the combined company. Zynga’s management team, led by Frank Gibeau and Zynga’s President of Publishing, Bernard Kim, will drive Take-Two’s mobile efforts and will oversee the integration, and day-to-day operations of the combined Zynga and T2 Mobile Games business, which will operate under the Zynga brand as its own label within the Company.
Take-Two’s Board of Directors will be expanded to 10 members to add two members from Zynga’s Board of Directors.
It should also be noted that after the execution date of the agreement, which expires on February 24, 2022, Zynga will have a 45-day period to solicit a potentially better deal from a different buyer.