EA to buy Glu Mobile for $2.4 billion

The Electronic Arts Inc., logo is displayed on a screen during a PlayStation 4 Pro launch event in New York
FILE PHOTO: The Electronic Arts Inc., logo is displayed on a screen during a PlayStation 4 Pro launch event in New York City, U.S., September 7, 2016. REUTERS/Brendan McDermid

February 8, 2021

(Reuters) – Electronic Arts Inc said on Monday it would buy Glu Mobile Inc for $2.4 billion, bolstering its mobile platform with the addition of games such as “Design Home”, “Covet Fashion”, and “MLB Tap Sports Baseball”.

EA has offered $12.50 in cash for each Glu share, a premium of about 33% to its closing price on Monday. Shares of EA were up 1.4% in extended trading, while those of Glu were halted.

The deal, which is expected to close in the quarter ending June 30, has a total enterprise value of $2.1 billion, including Glu’s net cash of $364 million.

Videogame sales in the United States hit a record $56.9 billion last year, according to research firm NPD, as demand for virtual entertainment soared after major public events were canceled to stem the spread of the novel coronavirus.

Earlier this month, EA raised its annual sales outlook, betting on strong sales of its sports titles including “FIFA 21” and “Madden NFL 21”.

(Reporting by Akanksha Rana in Bengaluru; Editing by Anil D’Silva)