Video game developer Electronic Arts (EA) has announced it has reached an agreement to acquire GluMobile at an equity value of $2.4 billion and an enterprise value of $2.1 billion.
Electronic Arts is hoping that the combined companies will prove to be a reliable growth engine in the future due to the recurring revenue streams generated by mobile games and the strong library of owned and licensed content possessed by both companies.
The combined company will have in its portfolio EA SPORT, FIFA, Battlefield, The Sims, Plants vs. Zombies, Deer Hunter, and MLB Tap Sports Baseball. EA is hoping that GluMobile’s expertise in monetising games will help to drive revenue growth in some of these established brands.
EA has agreed to pay a 36% premium to GluMobile relative to where shares were trading at the close on Friday. It is also expected to grow EA’s profitability in the first year. J.P. Morgan served as an advisor to EA on the deal while Goldman Sachs, UBS, and Morgan Stanley advised GluMobile.