Zynga, the social game developer best known for FarmVille, is being acquired by publisher Take-Two Interactive for $12.7 billion.
The deal sees Take-Two pay a 64% premium on Zynga's closing share price as of Jan. 7 and gain control of the company's entire gaming portfolio including CSR Racing, Empires & Puzzles, FarmVille, Golf Rival, Hair Challenge, Harry Potter: Puzzles & Spells, High Heels!, Merge Dragons!, Toon Blast, Toy Blast, Words With Friends, and Zynga Poker.
Take-Two views the acquisition as complimentary to its existing console and PC games business, with Zynga turning Take-Two into one of the largest mobile publishers overnight. Strauss Zelnick, Chairman and CEO of Take-Two, believes the acquisition will bring, "$100 million of annual cost synergies within the first two years post-closing and at least $500 million of annual Net Bookings opportunities over time."
By acquiring a social-focused gaming company, Take-Two could take advantage of some of its most popular products on mobile and online platforms. The company is most well-known for publishing the Grand Theft Auto series, but it also counts BioShock, Borderlands, Civilization, Max Payne, NBA 2K, PGA Tour 2K, Red Dead, WWE 2K, and XCOM, on its books.
The agreement Take-Two signed allows Zynga to seek out alternative deals until Feb. 24, so the potential exists for another company to swoop in and make Zynga a better offer. With Take-Two already offering such a big premium on the share price, though, that seems unlikely.