What else can Japanese company Softbank get into? Apparently the gaming business. After picking up 70% of Sprint for $20.1 billion and then turning around to purchase wireless distributor Brightstar for $1.26 billion, the company has now looked overseas, to Finland's mobile game maker, Supercell.
Supercell, the up-and-coming gaming studio behind Clash of Clans and Hay Day has sold a majority stake, or 51%, of its company to Softbank for a total of $1.53 billion. Softbank has teamed up with entertainment company GungHo Online, a company that's been around since 2002, to invest the money, and the two conglomerates will work together on the investment, with Softbank putting in 80% of the total capital. The acquisition also values Supercell at right around $3 billion, and the company pulls in $2.4 million in revenue daily.
Here's the word right from the press release about the acquisition and business deal.
GungHo started its online game business in 2002, and it has since then accumulated significant expertise and produced notable results in the development and operation of online games. As its Puzzle and Dragons for smartphone has hit over 19 million downloads in Japan and over 1 million downloads in both North America and South Korea, GungHo is focused on expanding to other markets. Through the Transaction GungHo will leverage Supercell's position among the apps in the Games category of the App Store and marketing power abroad to enhance its global expansion.
The plan is to have all of the transaction closed out by the middle of November, so this looks to be a quick turnaround for Softbank. While all of these purchases seem to be surprising coming from a company not many North Americans may be familiar with, Softbank currently has the third largest market capitalization in Japan. And, with now owning a quickly-rising mobile game studio, the company clearly is looking to invest in highly profitable ventures.
Other studios have also been acquired by different companies in the past few years. Zynga picked up OMGPOP of Draw Something fame for $200 million, only to see stocks plummet, employees leave and Microsoft's Don Mattrick take over as CEO. On the other side, EA's acquisition of PopCap, while shutting down the PlayFish studio, has seen an uptick in sales of several titles and the newest rendition of Plants vs Zombies has been highly anticipated since its announcement at E3. With all of that considered, this could go either way for Supercell, however the company affirmed that it will keep its independence and the CEO, Ilkka Paananen, will remain on as the head of the company after the transaction is finalized.
Be the first to comment!