Electronic Arts will buy Glu Mobile for $ 2.4 billion in mobile gaming

(Reuters) – Electronic Arts Inc. said Monday it would buy Glu Mobile Inc. for $ 2.4 billion, bolstering its mobile platform with the addition of games like “Design Home,” “Covet Fashion” and “MLB Tap Sports Baseball.”

The U.S. video game developer has offered $ 12.50 in cash for each share of Glu, a premium of approximately 33% at its closing price on Monday. Shares of Electronic Arts (EA) rose 1.4% in expanded trading, while shares of Glu rose 34%.

The deal, which is expected to close the quarter ending June 30, gives Glu a business value of $ 2.1 billion.

San Francisco-based Glu received several takeover bids last year as its shares have outperformed those of its playmates, a source familiar with the situation said.

EA, known for its sports gaming franchise, hopes to expand its mobile gaming titles by acquiring and attracting more female players through Glu’s casual gaming portfolio, including “Kim Kardashian: Hollywood.”

EA has been on the verge of buying as it is on a strong balance sheet and seems to be climbing with more game titles. In December, it acquired UK-based Codemasters for $ 1.2 billion. [nL4N2IU1P1]

U.S. video game sales hit a record $ 56.9 billion last year, according to research firm NPD, as demand for virtual entertainment increased after the cancellation of major public events for slow the spread of the new coronavirus.

Global gaming revenue grew 13.3% last year, faster than PC and console games, according to data from analyst firm Newzoo.

The gaming industry has seen a number of consolidations in recent months, including the acquisition of ZeniMax Media by Microsoft for $ 7.5 billion and the Swedish video game group Embracer by buying Gearbox and Easybrain.

Earlier this month, EA boosted its annual sales outlook by betting on strong sales of its sports titles, including “FIFA 21” and “Madden NFL 21”.

JP Morgan advised EA on the deal, while Goldman Sachs, Morgan Stanley and UBS Securities were advisers to Glu.