Electronic Arts Acquire PopCap Games

July 13th, 2011 at 1:02 pm
 


The tech industry is recently set abuzz with a number of acquisitions. And it seems that there is no stopping tech companies in trying to get whatever advantage they can have by acquiring other companies that they think will give them that edge. And on the gaming front, the acquisition bug has bitten game maker Electronic Arts.

According to reports coming from EA, the company has recently acquired PopCap Games. For those who are not in the know, PopCap Games are the developers of popular games like Bejeweled and Plants vs. Zombies. According to sources, the acquisition came after an agreement between both parties to a $650 million in cash payout along with $100 million in stock.

Not only that, the agreement also includes PopCap Games receiving up to $550 million from EA if it is able to achieve certain revenue milestones in the next couple of years. PopCap won’t be receiving anything in terms of earnouts if it generates gross revenues of less than $91 million until December of 2013. But then again, its shareholders stand to receive the $550 million if it hits a milestone of $343 million or more during the same period.

PopCap Games is a games developer that is headquartered in Seattle, Washington. It was founded back in 2000 and offers both downloadable and retail store games as well as social games available for Facebook and for smartphones and gaming consoles. A majority of PopCap Games’ revenue comes from digital platforms.

According to EA, it acquired PopCap Games in order to solidify its position in the digital games front. Ea has recently enjoyed outstanding growth on its digital game business which saw an average of 46 percent year over year growth. It has so far generated $800 million in revenues during the last fiscal year. The PopCap Games acquisition may further help improve its digital games business and to further explore the interesting area of mobile and social gaming.

 

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