Having just acquired Codemasters for a little over $1 billion, EA has announced they've bought up mobile game developer Glu Mobile for $2.1 billion USD. Assuming regulatory approval, the deal will officially close after June 31
Glu's catalog of mobile games includes original titles such as Diner Dash and Covet Fashion, along with licensed titles Disney Sorcerer's Arena and Kim Kardashian Hollywood. The company has some 800 employees with offices in San Francisco, Foster City, Toronto, and Hyderabad. EA is forecasting that Glu will bring in approximately $544 million USD in the first year. For comparison, EA's own mobile offerings before the acquisition totaled $779 million in 2020.
By the terms of the deal, Glu shareholders will be paid $12.50 USD per share, about 36% more than what the stock closed at last Friday. Glu's equity value is about $2.4 billion, but they have some $364 million in cash.
EA CEO Andrew Wilson commented enthusiastically about the deal. "Our acquisition of Glu combines amazing teams and deeply-engaging products to create a mobile games leader with proven expertise across many fast-growing genres," he said. "Mobile continues to grow as the biggest gaming platform in the world, and with the addition of Glu's games and talent, we're doubling the size of our mobile business. With a deep IP portfolio and an expanding global audience, we'll deliver more exciting experiences for our players and drive further growth for Electronic Arts."
Food For Thought
It's unlikely that EA is going to be leaving the AAA space anytime soon. However, between this deal and the Codemasters acquisition, there may be the sense within the company that EA needs to hedge their bets with smaller offerings to offset anticipated shortfalls. Mobile is making money for both companies. Whether Glu will ultimately remain a vibrant force within EA or be casually digested without another word remains to be seen. Hopefully, Glu staff will be able to moderate some of EA's less-than-well-considered impulses and avoid debacles like Dungeon Keeper Mobile in the future.