The Zynga logo is pictured at the company’s headquarters in San Francisco, California April 23, 2014. REUTERS/Robert Galbraith/File Photo
(Reuters) – FarmVille game maker Zynga Inc (ZNGA.O) said on Thursday it would buy an 80 percent stake in Empires & Puzzles publisher, Small Giant Games, for $560 million in a move to strengthen its gaming portfolio.
Zynga said it would buy the remaining 20 percent of the Helsinki, Finland-based mobile game studio over the next three years at valuations based on specified profitability goals.
The cash-and-stock deal, which is expected to close on Jan. 1, follows Zynga’s announcement last year to buy Peak Games, home to successful games such as “Spades Plus” and “Gin Rummy Plus”, for $100 million.
The company’s deal with Small Giant is expected to enhance profitability in 2019 and beyond.
The growing popularity of Zynga’s games, including “Words With Friends”, “Merge Dragons!” and “CSR2” during the holiday season, prompted the company to raise its fourth-quarter revenue forecast.
Zynga increased its revenue forecast to $243 million from an earlier expectation of $235 million, while net loss forecast was lowered to $1.5 million from an earlier outlook of $2 million.
Reporting by Vibhuti Sharma in Bengaluru and Liana B. Baker in New York; Editing by James Emmanuel