Zynga completes its acquisition of hyper-casual game maker Rollic
Zynga announced in August that it would be acquiring Istanbul-based Rollic, developer and publisher of hyper-casual gaming hits like Go Knots 3D and Tangle Master 3D. Today, it says the deal has closed.
To be clear, Zynga doesn’t completely own Rollic yet. Instead, it has purchased 80% of the company for approximately $180 million in cash, with additional payments to acquire the remaining 20% over the next three years.
In anticipation of the deal closing, CEO Frank Gibeau told me that this represents Zynga’s first move into the world of hyper-casual games — games where, as their titles suggest, players perform simple tasks like throwing knives and untying knots.
Rollic, he argued, has succeeded in a field where “for the first three years, everybody kept calling it a fad.” He was particularly impressed by the company’s development process, where it releases games at a rapid clip by managing a network of hundreds of developers.
“They already had some scale and some velocity and hit the ground running, but we thought they could grow faster with us,” Gibeau said.
He was also impressed by the size of their audience — apparently the combined companies will reach a total of 160 million monthly active users, with 65 million coming from Rollic. And as Gibeau noted, the ability to reach a large audience and monetize that audience without ad tracking will be even more important after Apple’s looming change, which will require app developers to allow their users to opt out of tracking.
This is Zynga’s fourth acquisition in Istanbul. In fact, it paid $1.8 billion for Peak Games just a of couple months before the Rollic deal. Asked whether it’s harder to bring new teams on-board when travel and in-person work is limited, Gibeau replied, “It requires a lot of Zoom time instead of face-to-face time.”
He added, “The good news about this is, it’s obviously a very tragic situation and the work-from-home environment is a big negative in a lot of ways, but for gaming companies, we’re in pretty good shape, right? We can build games in this environment.”
Gibeau also said that the company is interested in making more acquisitions, but the strategy is “not just being a roll-up.” And while Zynga has had its ups and downs since it first rode the wave of Facebook gaming, Gibeau noted that the company has beaten expectations with impressive revenue growth in recent quarters.
“I think we still have a lot to prove,” he said.