Once the transaction closes on Jan. 1, Zynga will own 80% of Small Giant. It’s paying $560 million for the acquisition, comprised of approximately $330 million in cash and $230 million in stocks. Zynga said it will purchase the remaining 20% of Small Giant over the next three years.
The acquisition adds an experienced team and an innovative franchise to Zynga’s live service portfolio while also expanding its new game pipeline, the company said.
“Empires & Puzzles” blends Match-3 battles with hero collection, base building, and social alliances. It’s repeatedly broken into the top 10 grossing games on Google Play and the App Store since launch and it’s been download over 26 million times.
“We’ve been impressed by the quality and momentum of ‘Empires & Puzzles’ as we add another ‘Forever Franchise’ into Zynga’s portfolio,” said Zynga CEO Frank Gibeau. “Small Giant has created an innovative game that delivers a unique player experience that engages over the long term. We are excited that Small Giant is joining Zynga as they enhance our next phase of growth.”
Small Giant will operate as a separate studio within Zynga after the acquisition, said the studio’s CEO, Timo Soininen. “Our studio was founded on the idea that small, skillful teams can accomplish giant things, and I am confident that partnering with Zynga is the right next step in our evolution,” he said. “By leveraging the expertise and support from the wider Zynga team, we will amplify the reach of ‘Empires & Puzzles’ and the new games in our development pipeline.”
Zynga also announced on Thursday it’s raising its fourth quarter 2018 guidance by $8 million due to the strong performances of “Words With Friends,” “Merge Dragons!” and “CSR2.” It now expects to make $243 million in revenue in Q4 2018.