Sega To Take Over Angry Birds Developer Rovio For $775M

Japanese gaming giant Sega has officially announced that it would pay €706 million ($775 million) in cash to acquire Angry Birds developer, Finland's Rovio.

It was initially reported in January that Israeli mobile gaming developer Playtika had made an $810 million proposal for Rovio.

However, negotiations broke down last month without either business giving any explanations.

The maker of Sonic the Hedgehog, Sega, was reportedly in the mix, although Rovio did disclose that it was still in negotiations with other companies.

Now that the acquisition is public, Rovio says it anticipates it to conclude in the second quarter of its current fiscal year, or somewhere in the next few months, subject to "certain customary conditions."

In comparison to Rovio's closing price on January 19, the last trading day before news of a prospective purchase first broke, and to Rovio's final closing price on Friday, April 14, Sega's offer implies a 63.1% premium and a 19% premium, respectively.

Rovio, which was founded in 2003, has become one of the biggest success stories in European technology.

Even though the company had already created dozens of games before Android and iOS, it was the growing smartphone revolution that propelled Rovio into the public eye.

Angry Birds became a worldwide phenomenon and spawned a franchise that included everything from toys and cookbooks to movies and a TV show.

Rovio went public in 2017 and was valued at $1 billion when it debuted on the Nasdaq Helsinki.

The company's shares have mostly been in decline throughout the subsequent years and currently trade for around half of what they were worth at the IPO.

Therefore, it may not have come as much of a surprise that Rovio had begun courting possible buyers.

Sega claims that with Rovio at its helm, it would "accelerate the development" of its own already-released games and "generate synergies" between Sega and Rovio's brands.

It appears that Rovio's expertise in so-called "live service" mobile gaming, which refers to games meant to be played more or less eternally through continuous content updates to keep players interested, is what particularly drew Sega's attention.

Additionally, Sega said that Rovio's experience might enable it in extending the distribution of its new and existing games in additional areas, notably in Europe and North America.

On the other hand, Sega asserted that it will leverage its knowledge of many platforms to help Rovio move beyond mobile gaming, presumably to consoles and/or web browsers.

As a result, this agreement effectively enables Sega to increase the prominence of its mobile gaming while also enabling Rovio to go a different path.

“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,” said Haruki Satomi, president and group CEO of Sega’s parent company Sega Sammy Holdings, in a press release.