Playtika to acquire Youda Games portfolio for initial €81.3m
The deal is worth an initial €81.3m (£70.0m/$89.3m) but Playtika said it could rise to as much as €150.0m based on performance targets.
The Youda Games collection includes a number of gambling-related titles such as social card-themed game Governor of Poker. Playtika will take ownership of the entire portfolio should the deal proceed as expected.
The deal is due to complete by the end of the third quarter, subject to customary closing conditions.
“The acquisition of Youda Games’ card game portfolio, with its strong IP, is in line with Playtika’s strategic incremental growth approach of leveraging our unrivalled LiveOps expertise and proprietary technology stack to optimise and scale games, strengthening our market position,” Playtika chief financial officer Craig Abrahams said.
“We believe this acquisition will be accretive to our financial performance and is part of our strategy to acquire proven franchises where we can add value.”
Azerion’s chief revenue officer Sebastiaan Moesman added: “Over the past few years, we have transformed our business. We have scaled digital advertising capabilities, developing our strategic portfolio of partner-led content and extending the presence and reach of our in-market commercial teams.
“As a result of this dynamic shift towards our digital advertising platform, social card games have become less strategic for Azerion. However, they remain an attractive investment opportunity for an industry partner such as Playtika.
“This divestment will further simplify our business and help us to continue investing in and delivering on our growth ambitions.”
Playtika fails in Angry Birds bid
The agreement comes after Playtika earlier this year dropped out of the running to acquire Rovio Entertainment. The developer is the company behind the hugely successful Angry Birds series.
The developer filed an initial proposal in November last year and increased its offer in January. At the time, Playtika CEO Robert Antokol said the deal would be valuable for Rovio’s shareholders.
However, Playtika in March said it would not be proceeding with talks and withdrew its proposal. This came after Rovio launched a strategic review to consider offers from Playtika and other interested parties.
In April, it was confirmed that Sega Sammy Holdings had agreed a deal to acquire Rovio for €706.0m. Its offer of €9.25 per share was higher than Playtika’s proposal of €9.05 per share.
Maintaining full-year guidance
In the weeks that followed, Playtika announced its first-quarter results, revealing a decline in revenue. For the three months to 31 March, revenue fell 3.1% year-on-year to $656.2m.
This came after the developer at the end of last year announced plans to lay off approximately 600 employees – 15% of its headcount. The business said this was part of the process of winding down its “non-core products”.
Playtika also confirmed in March it would largely suspend new game development until ROI on new games becomes “economically viable”.
However, despite all these factors, Playtika said it remains on track to perform in line with full-year guidance.
Playtika is due to announce its Q2 results on 8 August.