Zynga buys Toy Blast and Toon Blast maker for $1.8bn

Via Yahoo Finance

Zynga, the social video game developer, has bought Turkish video game business Peak for $1.8bn (£1.4bn) in its largest deal.

Peak has developed popular free-to-play smartphone games including Toy Blast and Toon Blast. The deal, which includes $900m in cash and $900m in Zynga stock, will see Zynga acquire 100pc of Peak.

San Francisco-headquartered Zynga has become one of the world’s largest video gaming businesses thanks to “casual” games such as FarmVille and Words With Friends.

The company, which went public in New York in 2011, now has a market cap of $8.7bn.

Zynga said in a press release on Monday that the deal to buy Peak will increase the number of daily active users of Zynga products by 60pc.

It also expects the acquisition of Peak to add around $600m of annual revenue to the business. The deal is expected to close in the third quarter of 2020.

Zynga’s acquisition of Peak is the largest exit to date for Berlin-headquartered venture capital firm Earlybird, which first backed Peak in 2011.

The fund said on Monday that it would receive $260m in cash and another $260m in Zynga shares from the acquisition.

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Hendrik Brandis, a co-founder of the fund, said the sale was evidence that “major investment rounds and exits are taking place again and that German investors are finally on board for the biggest global tech deals.”

Draper Espirit, the UK-listed investment firm, said on Monday that it had bought a stake in Peak from Earlybird last year which is now valued at £80m.

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Sidar Sahin, the chief executive of Peak, said: “This is a monumental partnership not only for Zynga and Peak, but for the whole mobile gaming industry. Both companies share a common vision – to bring people together through games.

“Peak’s culture is rooted in relentless learning and progress, so as we embark on this new chapter in our journey together with Zynga, we remain as committed as ever to our unique culture. We’re very excited for our combined future and what we will accomplish together.”