"Game On" is The Fly's weekly recap of the stories powering up or beating down video game stocks.
NEW RELEASES: Among this week's notable releases is the PC port of Capcom's (CCOEY) action role-playing game "Monster Hunter Rise," which launches on January 12 after previously only being available on Nintendo Switch (NTDOY). Meanwhile, Sony (SONY) is releasing a PC port of PlayStation 4 exclusive "God of War," which originally released in 2018. The PC version rolls out on January 14, joining other Sony exclusive titles recently released on PC, such as "Days Gone" and "Horizon Zero Dawn."
TAKE-TWO BUYS ZYNGA: Yesterday, Take-Two (TTWO) announced an agreement to acquire mobile game maker Zynga (ZNGA) in a cash and stock transaction valued at $9.86 per Zynga share, with a total enterprise value of roughly $12.7B. Under the terms and subject to the conditions of the agreement, Zynga stockholders will receive $3.50 in cash and $6.36 in shares of Take-Two common stock for each share of Zynga common stock outstanding at the closing of the transaction. The purchase price represents a premium of 64% to Zynga's closing share price on January 7. The combined entity has significantly greater scale, with $6.1B in net bookings, and $769M in adjusted unrestricted operating cash flow on a pro-forma basis for the trailing twelve-month period ended September 30, 2021. Looking ahead, the combined company is expected to deliver a 14% compound annual growth rate for net bookings over the three-year period from Take-Two's FY21 through FY24. Zynga stockholders will receive $3.50 in cash and $6.361 in shares of Take-Two common stock for each share of Zynga common stock outstanding at the closing. As part of the transaction, Take-Two has received committed financing of $2.7B from J.P. Morgan and intends to fund the cash component of the transaction through a combination of cash from its balance sheet as well as proceeds of new debt issuance. The merger agreement provides for a "go-shop" provision under which Zynga and its board of directors may actively solicit, receive, evaluate, and potentially enter negotiations with parties that offer alternative proposals during a 45-day period following the execution date of the definitive agreement, expiring on February 24. The Fly notes that Zynga makes mobile titles such as "Farmville," "Star Wars Hunters," "Words With Friends," and "Zynga Poker."
MARIO KART: Late last week, Serkan Toto, a Tokyo-based games industry analyst, told Gamesindustry.biz that "Mario Kart 9" is in active development and that Nintendo could tease the game, which comes with "a new twist," later in 2022. On mobile, Nintendo has been very silent since Mario Kart Tour's launch in 2019, but I think 2022 is when we will see an established IP arriving on smart devices again," Toto told Gamesindustry.biz.
Several days after the prediction was made public, Nintendo Life's Ryan Craddock reported that, for the week ending January 8, Nintendo's "Mario Kart 8 Deluxe" has remained on top for the second consecutive week in the U.K. in terms of physical sales. The data show that, despite the game's launch in 2017, "Mario Kart" has so far been at the top of the video game charts in the U.K. for the entirety of 2022 so far, Craddock added. The Fly notes that "Mario Kart 8 Deluxe" is the best selling game on the Nintendo Switch and one of the ten best-selling video games of all time.
UBISOFT/XBOX: Last Wednesday, Ubisoft (UBSFY) announced that it is bringing Ubisoft+, its game subscription service, to Xbox (MSFT). "Expect more news in the future," the company tweeted. As part of the announcement, Microsoft said that Ubisoft's upcoming shooter "Rainbow Six Extraction" will launch on Xbox One, Xbox Series X/S, and PC on January 20 and will release day one with Xbox Game Pass for console, PC, and cloud. "Sharing in our commitment to bring fans new and exciting games on day one, Ubisoft also announced today their intent to bring Ubisoft+ to Xbox platforms in the future," Microsoft added. "This will be a great addition for fans who will have even more ways to access the games and experiences they love on Xbox."
OTHER STORIES TO WATCH: