Sega to buy Angry Birds maker Rovio for $776 million
Sonic the Hedgehog and Red the Angry Bird are about to be corporate siblings, after Japanese game maker Sega agreed to purchase Finnish mobile studio Rovio.
Driving the news: Sega announced early Monday that it plans to buy Rovio for €706 million ($776 million) in a friendly offer approved by Rovio's board.
- The deal is expected to close between July and September, pending regulatory approval, according to Sega's announcement of the deal.
- It was first reported on Friday by the Wall Street Journal.
Between the lines: Purchasing Rovio will give Sega access to one of the best-known gaming franchises in mobile.
- Angry Birds, like Sega's Sonic, is aggressively licensed beyond games, with its cast of avians featured in merchandise and movies.
- In its announcement, Sega said the purpose of the deal was to tap Rovio's mobile and live game expertise, including the Finnish company's Beacon platform for running live-service games..
- The deal will take some pressure off Rovio to find new hits beyond Angry Birds, a franchise it has successfully banked on since 2009 while struggling to branch out.
What they'r'e saying: "I am confident that, through combination of both companies’ brands, characters, fanbase, as well as corporate culture and functionality, there will be significant synergies created going forward," Haruki Satomi, CEO of Sega Sammy Holdings said in a statement.
The big picture: The deal continues the trend toward consolidation in the games industry, most vividly exemplified by an early 2022 flurry of multi-billion deals, including Microsoft's still-pending $69 billion bid for Activision.
- Earlier this month, Saudi government-funded Savvy Entertainment Group continued its pledge to invest some $38 billion in gaming by announcing a $4.9 billion bid to buy mobile giant Scopely.
Thought bubble: The key to many recent deals is the desire for rich gaming giants to reach mobile gamers by buying the biggest players in the space.
- That's the move behind Sega-Rovio, Savvy-Scopely, last year's Take Two buy of Zynga, and Microsoft's actual stated goal for buying Activision Blizzard. The biggest prize there, Microsoft says, isn't Activision's Call of Duty but the King division's Candy Crush Saga).
- For these companies, reaching hundreds of millions of PC and console players isn't enough when there are theoretically billions of mobile players out there.