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Zynga Has Raised $874.5m Through Private Offering

PUBLIC OFFERING | ANNOUNCEMENT DATE: 14 DEC 2020
WRITTEN BY | 17 Dec 2020
Zynga Has Raised $874.5m Through Private Offering
PUBLIC OFFERING
2 OCT 2020
Zynga Has Completed The Acquisition Of 80% Of The Shares In Rollic For $180m
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💵 Private Placement

  • San Francisco-based mobile game developer and publisher Zynga Inc. (Nasdaq: ZNGA) has announced a private offering of $762m convertible senior notes due 2026. Also, the company is going to offer an additional $112.5m amount of notes to the first purchasers of the convertible senior notes during the period of 13 days after the purchase of the notes

  • The notes are Zynga’s senior obligations, convertible into cash, Zynga shares, or both, with interest paid semiannually in arrears. The company will determine the interest rate, initial conversion rate, and other terms at the time of pricing of the offering

  • Zynga doesn’t disclose any certain aims of the offering, though it says that the part of the raised sum will be used to pay the cost of capped call transactions, which Zynga is expecting to enter into with one or more initial purchasers

  • Lately, Zynga has been building its Turkish hub of mobile game developers (Peak Games, Gram Games, Rollic), entering the hyper-casual sector, diversifying product portfolio, increasing audience footprint with cross-selling opportunities, and potential improving profitability. Considering this, it is fair to assume that some of the money will be used to support future growth of the company

  • Earlier this month, Zynga has raised $425m through a three-year secured revolving loan facility, which will replace $200m loan provided in December 2019

🎲 Products

  • Zynga focuses on web and mobile online social games with more than 70 titles, that have generated over a billion downloads. Among the company’s best-known games are Tangle Master 3D, Zynga Poker, Harry Potter: Puzzles & Spells, and Words With Friends 2 Word Game

  • In May 2020, The company launched one of its most successful titles Tangle Master 3D. This mobile puzzle game has been downloaded about 100 million times with a peak of 34.6 million downloads in June 2020. As for November 2020, the game is still one of the most popular games of Zynga (10+ million downloads)

  • However, another puzzle game of the company has lately seen an increase in downloads. Launched in March 2020, Harry Potter: Puzzles & Spells has been downloaded more than 13 million times, with more than 11 million downloads generated during the last three months

Zynga downloads.jpg

💵 Previous Acquisitions

📈 Financial Performance

  • In 2019, Zynga generated $1.3B revenue, which is 31% more than the year before, while its bookings increased by 38%, and reached $1.5B

  • In Q3 2020 the company generated $503m revenue and $628m bookings, while in Q3 2019 revenue was $345m, and bookings were $395m

Zynga revenue and bookings
Zynga stock chart

SOURCES: ZYNGA

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EARLY VENTURE
Zynga
  • Established in 2007, publicly traded on NASDAQ stock exchange since 2011

  • Headquarters — San Francisco, United States

  • Team of 1,883 employees (as of December 31, 2019)

  • Founded by — Mark Pincus, Eric Schiermeyer, Justin Waldron, Michael Luxton, Steve Schoettler, and Andrew Trader

  • Mobile game developer and publisher

  • Full year 2020 guidance: revenue — $1.8B, bookings — $2.2B (doesn’t include Rollic projections)

  • Latest interim presentation, 2019 annual report