A group of Chinese companies, led by Shanghai Giant Network Technology Co., Ltd. affiliate, has emerged as the preferred buyer of social casino gaming developer Playtika. The consortium has agreed to pay the amount of $4.4 billion for the Israel-based gaming studio.
Playtika was founded in 2010 and was purchased by Caesars Interactive Entertainment a year later. The company started off with ten employees and has gradually grown to now employ more than 1,000 people. Playtika was among the first, if not the first, company to offer social casino games. According to industry experts, it currently holds the biggest share in the rapidly growing $3-billion social casino market. Playtika has over 6 million daily active players from 190 countries around the world.
When Caesars Interactive Entertainment, subsidiary of major gambling operator Caesars Entertainment Corp., purchased the game developer, it believed that it was an excellent and profitable business to go along with its World Series of Poker brand and its real-money interactive division. However, it has recently been announced that the online gambling operator would sell off the business in a bid to raise money for a huge debt it has been facing for some time now.
The group of Chinese companies to buy Playtika includes Shanghai Giant Network Technology Co., Ltd. affiliate – Giant Investment (HK) Limited; China Oceanwide Holdings Group Co., Ltd.; Yunfeng Capital, a private equity firm founded by Jack Ma, founder and Chairman of Alibaba Group; CDH China HF Holdings Company Limited; China Minsheng Trust Co., Ltd.; and Hony Capital Fund.
Under the terms of the acquisition deal, Playtika’s existing management team will continue running the company’s daily operations from its headquarters in Herzliya, Israel. The gaming studio also runs offices in Belarus, Romania, Ukraine, Canada, the United States, Argentina, Japan, and Australia.
The transaction is subject to regulatory approvals and is likely to be closed sometime in the third or fourth quarter of the year. It is important to note that Caesars Interactive Entertainment’s WSOP brand and real-money Internet gambling businesses are not included in the deal. In addition, buyers pointed out that the virtual currency used on Playtika’s gaming platform would keep not being exchangeable for real money even after the transaction is completed.
Commenting on the announcement, Playtika co-founder and CEO Robert Antokol said that the deal is indicative of his company’s “unique culture and innovative spirit of [its] employees.”
Giant founder and Chairman Shi Yuzhu said in a statement that they are looking forward to seeing Playtika continue growing, innovating, and excelling in the social casino business.
Based in Shanghai, Giant is known to be the developer and operator of massively popular multi-player games, with the ZT Online series being among its best-known products among Chinese players. The company has almost 50 million monthly active users.
