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Sega Sammy to acquire Angry Birds creator for €706m

| By Robert Fletcher
Sega Sammy Holdings, the Japan-based gaming heavyweight formed by the merger of Sega and Sammy Corporation, has agreed a deal to acquire Rovio Entertainment for €706.0m (£625.6m/$774.6m).

Through a tender offer, Sega Sammy will acquire all outstanding shares and options in Rovio, the developer of the Angry Birds franchise, at €9.25 per share and €1.48 per option.

Sega Sammy said the acquisition represents a friendly takeover, with Rovio’s board having agreed to, and expressed support towards, the offer. Rovio shareholders that in aggregate hold shares corresponding to approximately 49.1% of the outstanding shares and votes in Rovio have irrevocably undertaken to accept the offer, subject to certain customary conditions. 

The acquisition is expected to close in the second quarter of the 2023-24 financial year but remains contingent on the completion of reviews under antitrust laws and other customary conditions.

“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,” Sega Sammy president and group chief executive Haruki Satomi said. 

“I feel blessed to be able to announce such a transaction with Rovio, a company that owns Angry Birds, which is loved across the world, and home to many skilled employees that support the company’s industry leading mobile game development and operating capabilities. 

“Historically, as represented by the Sonic the Hedgehog series, Sega has released countless video game titles to various gaming platforms. I am confident that, through a combination of both companies’ brands, characters, fanbase, as well as corporate culture and functionality, there will be significant synergies created going forward.”

Growth plans

Sega said the acquisition would help to accelerate its growth in the global gaming market, as well as increase its corporate value by generating synergies between its existing businesses and Rovio’s strengths including its global IPs and live-operated mobile game development capabilities. 

As such, Sega said it will utilise Rovio’s experience in live service mobile game operation to bring its titles to the global mobile gaming market. Sega also said that the acquisition would support cross-platform expansion of Rovio’s IP using Sega’s capabilities, as well as the growth of both companies’ fanbase by sharing know-how regarding multi-media expansion of global characters.

“I grew up playing Sonic the Hedgehog, captivated by its state-of-the-art design,” Rovio chief executive Alexandre Pelletier-Normand said. “Later, when I played Angry Birds for the first time, I knew that gaming had evolved into a true mainstream phenomenon, with the power to shape modern culture.

“Our mission is to ‘craft joy’ and we are thrilled at the idea of using our expertise and tools to bring even more joy to our players, enhancing and expanding Rovio’s and Sega’s vibrant IPs.

“Combining the strengths of Rovio and Sega presents an incredibly exciting future.”

Initial talks

Confirmation of the agreement comes after it was earlier reported that Sega had entered into discussions over a potential tender offer for Rovio.

Rovio confirmed the early talks in a statement but said there was no certainty as to when the possible tender offer would take place or whether it would take place at all.

Developer Rovio in February launched a strategic review of its business and announced that it would hold preliminary non-binding discussions with certain parties in relation to a potential tender offer for its shares.

This came after Playtika put forward an all-cash acquisition offer of €8.50 (£7.52/$9.34) in November last year, while the social gaming developer returned with an improved offer of €9.05 per share in January.

While talks took place with Rovio – and Playtika chief executive Robert Anokol said the deal would be valuable for Rovio’s shareholders – Playtika pulled out of discussions last month.

Neither Playtika nor Rovio went into detail about the termination of talks, although Rovio at the time said discussions were ongoing with other parties.

Rovio’s Angry Birds franchise launched in 2009 and has spawned a host of spin-off games, books, comics, films and animated series, as well as a number of theme park rides.

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