Pincus: Zynga's $400M Supercell Deal Fell Through
Mark Pincus revealed that Zynga agreed to acquire Supercell for $400 million in 2012, but the deal collapsed after Zynga's board refused further acquisitions.
Mark Pincus has revealed that Zynga and Supercell reached an agreement on a $400 million all-cash acquisition in 2012, but the deal ultimately fell through. Speaking on a podcast, Pincus said Zynga's board refused to approve further acquisitions until he proved he could manage the company's existing assets.
Pincus also said he was advised he could force the deal through by firing the board, but chose not to do so. The board's stance followed the failure of Zynga's 2013 acquisition of OMGPop, the Draw Something developer that Zynga bought for $180 million and closed less than 18 months later.
At the time of the failed Supercell deal, Zynga was still led by Pincus. He stepped down as CEO in 2013 and was succeeded by Don Mattrick, who left Xbox to join the company. Under Mattrick, Zynga later acquired NaturalMotion for $527 million.
Pincus returned to Zynga in 2015, when the company held $1 billion in foreign cash. He authorised $800 million in stock buybacks, reduced the workforce by 18%, and narrowed the game portfolio. A year after the failed acquisition, Supercell made $500 million in net profit.
The story was first reported by gamesindustry.biz.
Quick answers
How much did Zynga agree to pay for Supercell?
$400 million in an all-cash deal in 2012.
Why did the Zynga-Supercell deal fall through?
Zynga's board refused to approve further acquisitions until Mark Pincus proved he could manage existing assets.
Did Mark Pincus consider forcing the deal?
Yes, he said he was advised he could force it by firing the board, but he chose not to.