Zynga Scores Big with This Acquisition
Zynga (NASDAQ:ZNGA) seems to have a winner of a deal in the works. The developer of such popular social games as FarmVille and Zynga Poker has plans to buy OMGPOP for an estimated price of $200 million to $250 million, according to a report by the E-Commerce Times.
OMGPOP, maker of the hit game “Draw Something” and 35 other social games, will work on creating new mobile products for Zynga once the merger is complete. Raviv Turner, founder and CEO of Guerillapps, thinks the move is a good one based on OMGPOP’s financial information, said the report.
“Draw Something” is now the top-grossing product in the App Store, generating a reported $250,000 a day or $90 million a year, and Turner points out that this makes a $200 million purchase price something of a steal. He also notes that Zynga is fairly new to the mobile arena, and OMGPOP could give the company a boost in this area.
“Again, it makes sense for Zynga or any company, for that matter,” said Turner. “If you can’t build something quickly enough, you buy it — and you might as well buy the most popular game at the moment.”
David Tomczyk, assistant professor of management at the Quinnipiac University School of Business, said the two companies are a good match because most Zynga games allow players to “interact with each other in a turn-based setting,” while “OMGPOP focuses more on games that have players interacting in real-time,” the report said. He also noted that bringing OMGPOP into the fold will allow Zynga to branch out into games that are faster paced and have a clearly defined ending. All of this, said Tomczyk, will help Zynga attract a more diverse group of users.
The acquisition is ultimately an important step in Zynga’s attempt to gradually create an identity for itself apart from Facebook, while still maintaining a relationship with the social media giant.