A few months ago, Activision Blizzard announced plans to purchase Candy Crush creator King Digital Entertainment. This would allow Activision Blizzard to accent its current online offerings with King's fan-favorite titles that appeal to a more casual crowd. And now, in a new press release, Activision Blizzard announced that the acquisition is complete. With a combined player base of over 500 million users across almost every country, this gives Activision Blizzard the largest online game network in the world.
The acquisition of King cost Activision Blizzard $5.9 billion, with the purchase being made at an equivalent of $18 per share for King's outstanding shares. The executives at Activision Blizzard seemed happy to have the acquisition complete, with CEO Bobby Kotick commenting on how the acquisition will help the company expand its brand:
"We now reach over 500 million users across almost every country, making us the largest game network in the world. We see great opportunities to create new ways for audiences to experience their favorite franchises, from ‘Candy Crush’ to ‘World of Warcraft’ to ‘Call of Duty’ and more, across mobile devices, consoles and personal computers.”
King CEO Riccardo Zacconi also commented on the acquisition:
"We are thrilled to now be a part of Activision Blizzard and can’t wait to start working together. I want to thank everyone at King for all of their hard work since we founded the company 13 years ago. We are excited about the future as we continue developing more exciting games and explore new ways to serve our players and build on the greatest franchises in interactive entertainment.”
While King is now a wholly owned subsidiary of Activision Blizzard, it will continue operating as an independent unit within the company. Zacconi, along with Chief Creative Officer Sebastian Knutsson and Chief Operating Officer Stephane Kurgan, will continue overseeing King's operations as part of Activision Blizzard. This suggests that King's products will change very little if at all as a result of this acquisition, though the company will potentially have access to larger budgets and resources for game development.
Some gamers may question why Activision Blizzard would be interested in a company like King or why it would pay so much to acquire the casual game studio. There is definitely a potential for profit in the casual market, and King has replaced Zynga as the top contender within the casual market. Activision Blizzard already anticipates earning around $6.1 billion in 2016, and adding in revenue from King's userbase will help this figure to grow in the future.
The purchase also gives Activision Blizzard more leverage to compete against publishers such as Electronic Arts, which purchased casual game studio PopCap in 2011. Despite producing games that are quite different than Activision Blizzard's main offerings, King provides much-needed access to the casual games market that is so popular on social media and mobile devices. Buying one of the top players gives the company an "in" at the top, instead of going through the trial-and-error of trying to create new games that may or may not prove popular among mobile gamers.
Source: Activision Blizzard, Inc.
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