[UPDATE: 15/04/23]: Rovio has confirmed it is in talks with Sega. It said in a statement today:
“As part of its strategic review, Rovio Entertainment Corporation confirms that it is in discussions with Sega Sammy Holdings Inc.
On February 6, 2023, Rovio Entertainment Corporation announced the commencement of a strategic review and preliminary non-binding discussions with certain parties in relation to a potential tender offer for Rovio’s shares.
With reference to recent information in the media, Rovio confirms that it is in discussions with Sega Sammy Holdings Inc. regarding a possible tender offer for Rovio’s shares. Rovio and Sega will release further information at an appropriate time. There is no certainty as to when the possible tender offer would take place or whether it would take place at all, nor as to the terms of such potential tender offer.
Rovio does not comment on valuation estimates presented in the media due to the ongoing discussions and there can be no assurance that such estimates would reflect the outcome of the discussions.”
The original story continues below.
Sega is about to seal a $1bn acquisition of Rovio, according to a report in The Wall Street Journal. Rovio and Sega have not responded to requests for comment as yet.
The reported $1bn figure is higher than the offer Playtika publicly made back in January, which was worth just over $800m.
This one’s a little surprising – Sega is not known for its mobile output beyond the popular Sonic Dash games and the mobile editions of Football Manager. It has not been mentioned as a potential suitor by any of the sources we have spoken to, either.
But the two firms are similar in some ways: they each have family-friendly, character driven IP in their respective portfolios – Sonic and Angry Birds – and each has seen some success translating those games into films in recent years.
There is a precedent of sorts from Sega’s point of view, too. Back when it was a console-only publisher in the mid-2000s, it invested heavily to expand onto PC by first acquiring Total War maker Creative Assembly in 2005, then Football Manager maker Sports Interactive in 2006.
This reported move for Rovio would effectively do the same thing for mobile: add an established force with proven hit IP to its portfolio within a largely unexplored market for Sega.
The reported $1bn also appears to be something of a bargain if you consider Scopely is currently being acquired by Savvy Games Group for much more – $4.9bn – and doesn’t own original IP on the same scale as Angry Birds.
This proposed deal suits Rovio too. It is looking to get a foothold in PC and console, and recently set up a new studio in Montreal to make that happen. Announced in November 2022, Studio 6 is led by ex-Voodoo and Square Enix Montreal leader Mehdi El Moussali, former Eidos Montreal COO Andreane Meunier and Rovio’s overall studio boss Andy Muesse.
Playtika launched its public bid to acquire Rovio in January, having already offered to buy the Angry Birds maker privately in November 2022.
Rovio later said that it was talking to other suitors as well as Playtika as its strategic review continued. Last month, the two companies announced that the deal was dead, but Rovio said it would continue to talk to other potential acquirers. Names connected to a potential Rovio buyout in previous weeks and months included Netflix, Disney, EA and Take-Two.
In between all that, we reported on how Rovio staffers felt about a potential deal with Playtika, which, in short, was not good.