Activision Blizzard to buy ‘Candy Crush’ maker King Digital for $5.9-billion

After video game maker, King Digital Entertainment, maker of “Candy Crush” took heavy losses, Activision Blizzard Inc., the company that makes “World of Warcraft” chose to buy the former. for a whopping $5.9 billion, IBT reported. Although, the close deal will be expected in 2016, the full approval will depend on the remaining 75% votes from the King’s investors that will be conducted at their headquarters in Ireland, according to Financial Times.

Activision stated that purchasing King will broaden its reach with 60% of King’s players being female.

King chief executive Riccardo Zacconi will continue in his role at the firm, along with chief creative officer Sebastian Knutsson, and chief operating officer Stephane Kurgan. Candy Crush revenues account for about one-third of the company’s total revenue, which has been on a decline since the last four quarters.

Activision said it would use US$3.6 billion of offshore cash and borrow the rest from Bank of America Merrill Lynch and Goldman Sachs Bank as incremental lenders. The game itself is free to play, but you can spend a bit to get an additional feature or to skip past a frustrating level. Company shares were at $17.73 on Tuesday. Activision Blizzard has a large portfolio of games since its merge in 2007, these games include Call of Duty, Guitar Hero, Skylanders, Diablo and Destiny, with the plans of acquiring King Digital Entertainment; they are now expanding outside the console and PC market. Many of its games run on less sophisticated smartphones, requiring little hardware investment from users, and therefore reaching a wider public.

As gamers move from consoles to mobile devices, video game makers are switching from the physical sale of games to digital growth. CEO Bobby Kotick expressed that the computer game company has not been as active in the fast-growing mobile space. Shares of King closed at $15.54 in trading Monday on the NY Stock Exchange.

According to a few estimates, the mobile gaming market is expected to generate over $36 billion of revenue by the end of 2015 and grow by over 50 per cent in the next four years.