While indie developers thrive and bigger game companies are making fortunes, the video game industry is experiencing quite a stir.
After record-breaking mergers and acquisitions, the industry is shifting a bit, where bigger companies are buying smaller game developers. And this time, SEGA, the Japanese multinational video game and entertainment company headquartered in Shinagawa, Tokyo, that is buying Rovio, the creator of the ever-popular 'Angry Birds' video game.
In a yet another example of a large-scale mobile developer being scooped up by a bigger, traditional brand, SEGA acquires all of Rovio’s outstanding shares and options at €9.25 per share and €1.48 euros option.
This translates to €706 million, or about $776 million.
The amount is less than the $1 billion price that was previously being rumored.
Rovio Entertainment Oyj (formerly Relude Oy and Rovio Mobile Oy and doing business internationally as the Rovio Entertainment Corporation) is a Finnish video game developer based in Espoo.
Founded in 2003 by Helsinki University of Technology students Niklas Hed, Jarno Väkeväinen and Kim Dikert, the company is best known for the Angry Birds franchise.
The game series which focus on the eponymous flock of colorful angry birds who try to save their eggs from green-colored pigs, have been praised for its combination of fun gameplay and comical style approach. Its popularity led to many spin-offs, a market for merchandise featuring its characters, Angry Birds Toons, a televised animated series, and two films.
With billions of people have downloaded the game, Angry Birds's success has helped Rovio establish itself as Finland leading player in the mobile game industry, and has helped create a thriving ecosystem for game development in the country.
And the acquisition of Rovio was first announced by video game developer Sega Sammy Holdings, parent company of SEGA, on its website.
The company has announced its intentions to purchase Angry Birds creator and rightsholder Rovio Entertainment, after making a deal with the Finland-based Rovio’s board of directors.
What this means, characters like Red, Stella, Mighty Eagle, The Blues, Bubbles, Hal, Bomb and others, are flocking to join Sonic the Hedgehog, his two-tailed fox friend Tails, Sonic's self-proclaimed girlfriend Amy Rose the pink hedgehog, Knuckles the Echidna, and more.
The deal comes about two weeks after Saudi Arabia’s Savvy Gaming Group agreed to buy mobile game maker Scopely for $4.9 billion.
This is part of a shift in the game industry, where consolidating in games has been going, and has featured deals such as Microsoft’s $68.7 billion attempt to buy Activision Blizzard, and Take-Two previously purchased Farmville’s Zynga for $12.7 billion.
As for the reason why SEGA is purchasing Rovio, is because by acquiring it, the Japanese company is able to add one of the biggest mobile gaming titles of all time to its catalogue.
According to SEGA's president and group CEO Haruki Satomi:
More importantly the acquisition can help SEGA accelerate its own development of mobile-compatible and multi-platform versions of existing Sega IPs, because with the acquisition, SEGA also acquires Rovio’s live-operated mobile game development capabilities and expertise in mobile game operation.
What this means, the move is part of SEGA's plan to convert existing intellectual properties into global brands, strengthening user engagement through multi-platform support and enhanced media mix and more.
And according to Rovio CEO Alexandre Pelletier-Normand:
