Tuesday, July 23, 2024

Angry Birds: Sega agrees to buy video game maker Rovio

  • By Peter Hoskins
  • Business Correspondent

image caption,

Angry Birds games have become very popular in the last decade

The maker of Angry Birds video games has agreed to be acquired by the Japanese gaming company behind the Sonic the Hedgehog character.

Japan’s Sega Sami Holdings is paying €706m (£625m) for Finland-based Rovio Entertainment.

Rovio said Angry Birds was the first mobile game to be downloaded a billion times, and the brand has also produced two Angry Birds movies.

However, Rovio has yet to build a following to match its success.

This made it a potential acquisition target for major gaming industry companies.

Last year, the company — which has about 550 employees in eight game studios around the world — said downloads on its standard games hit five billion.

Announcing the deal, Sega said its decision to buy Rovio was driven by the need to “strengthen its position” in the global gaming market.

This market is expected to grow to $263.3bn by 2026, with the percentage of mobile gaming expected to increase to 56%.

Sega said it will use Rovio’s “unique know-how in direct service mobile game operations” to bring its own existing and new titles to the global mobile gaming market.

It highlighted Rovio’s mobile gaming platform Beacon, which it said has “20 years of high-level expertise in live service-mobile game operations” in the US and Europe.

“I feel blessed to announce such a transaction with Rovio, the company behind the globally loved ‘Angry Birds’,” he added.

Rovio’s revenue increased from €272.3m in 2020 to €317.7m in 2022, but its operating profit fell from €42.5m to €28.6m in the same period.

At the close of trading on Friday, Rovio’s stock market valuation was $707m (£571m).

Sega Sammy is a Japanese global holding company formed in 2004 by the merger of video game company Sega and Sammy Corporation.

Sega has produced several million-selling video game franchises and is known worldwide for its character Sonic the Hedgehog, which is featured in two movies.

Sammy manufactures and sells amusement arcade machines.

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