Rovio Entertainment, the Finnish-based video games company behind Angry Birds, has begun non-binding talks about a sale with Playtika, an Israeli group behind casino-style online games and shooting simulator 1V1.LOL.
Playtika has offered €9.05 ($9.74) per share, or €683 million euros ($735 million), for Rovio in the latest consolidation move in the gaming business. The bid, when it was submitted on Jan. 19, corresponded to a premium of around 60 percent over Rovio’s closing share price. Rovio shares have since jumped on news of the potential deal and stand at around €8.61 ($9.27).
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“Pursuant to its fiduciary duties, the board of Rovio continues to explore all strategic alternatives in order to reach the best possible outcome for Rovio and its shareholders,” the company said in a statement. “There can be no assurance that the strategic review and the preliminary non-binding discussions will result in any cash or other tender offer or any other transaction, or the pricing of any such possible transaction. Rovio will release further information at an appropriate time.”
Playtika’s move for Rovio follows similar consolidation moves across the gaming industry. Microsoft is in the process of buying Activision Blizzard, makers of Call of Duty and World of Warcraft, for $69 billion. Sony Interactive Entertainment last year acquired, for $3.6 billion, Halo creator Bungie Inc.
Playtika itself is carrying out some international consolidation. The company last month unveiled it was laying off some 600 employees, 15 percent of its workforce, as it consolidates studios to focus on its “core products.”
The mobile game market, which shot up during the COVID pandemic, has been sharply down as of late. Estimates from gaming analytics firm NewZoo put global mobile gaming revenue in 2022 at $92.2 billion, more than 6 percent down from a year earlier.
Rovio’s signature game, Angry Birds, has been a huge international success, spawning a merchandising and media empire, including two Angry Birds films. But the company has struggled to diversify, despite acquisitions, such as Denmark’s Darkfire Games in 2020 and the Turkish Ruby Games in 2021.
