Take-Two Interactive Is Buying Zynga in a Deal Worth $12.7 Billion

Take-Two Interactive, the games-publishing powerhouse behind the “Grand Theft Auto” series, plans to acquire casual mobile-games vendor Zynga, whose titles include “FarmVille” and “Words With Friends,” in a cash-and-stock deal worth $12.7 billion.

The deal, if it goes through, will create one of the world’s largest publicly traded gaming companies — $6.1 billion in pro-forma net bookings for the 12 months ended Sept. 30, 2021. The companies said the “transformative” deal will deliver $100 million of annual cost savings within the first two years after closing.

Take-Two’s games, in addition to Rockstar Games’ long-running “GTA” franchise, include Red Dead Redemption, Midnight Club, NBA 2K, BioShock, Borderlands, Civilization, Mafia, and Kerbal Space Program, while Zynga’s portfolio includes titles, such as CSR Racing, Empires & Puzzles, FarmVille, Golf Rival, Hair Challenge, Harry Potter: Puzzles & Spells, High Heels!, Merge Dragons!, Toon Blast, Toy Blast, Words With Friends, and Zynga Poker.

“We are thrilled to announce our transformative transaction with Zynga, which significantly diversifies our business and establishes our leadership position in mobile, the fastest growing segment of the interactive entertainment industry,” said Strauss Zelnick, Chairman and CEO of Take-Two. “This strategic combination brings together our best-in-class console and PC franchises, with a market-leading, diversified mobile publishing platform that has a rich history of innovation and creativity. Zynga also has a highly talented and deeply experienced team, and we look forward to welcoming them into the Take-Two family in the coming months. As we combine our complementary businesses and operate at a much larger scale, we believe that we will deliver significant value to both sets of stockholders, including $100 million of annual cost synergies within the first two years post-closing and at least $500 million of annual Net Bookings opportunities over time.”

“Combining Zynga’s expertise in mobile and next-generation platforms with Take-Two’s best-in-class capabilities and intellectual property will enable us to further advance our mission to connect the world through games while achieving significant growth and synergies together,” said Frank Gibeau, CEO of Zynga. “I am proud of our team’s hard work to deliver a strong finish to 2021, with one of the best performances in Zynga’s history. We are incredibly excited to have found a partner in Take-Two that shares our commitment to investing in our players, amplifying our creative culture, and generating more value for stockholders. With this transformative transaction, we begin a new journey which will allow us to create even better games, reach larger audiences and achieve significant growth as a leader in the next era of gaming.”

Take-Two’s deal for Zynga is expected to close during the second quarter of 2022, subject to the approval of both companies’ stockholders and regulatory approvals.

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