Big companies gobbling up smaller ones is nothing new

But in a seemingly endless effort to grow by acquisition, large players in the video game industry have made some massive deals of late.

Already this year, and we’re barely two months in, M&A deals in the video game industry have topped $80 billion, already matching the record-breaking year of 2021.

This year, Take-Two Interactive acquired Zynga for a then record 12.7 billion. Not to be outdone, Microsoft acquired Activision Blizzard for a new record $68.7 billion. Even with these two outrageous deals, M&A activity within the industry shows no signs of slowing down.

Just last week, in fact, Sony announced a $3.8 billion deal to acquire Bungie.

According to Piers Harding-Rolls, of Ampere Analysis, competition is what’s driving these massive deals. Big Tech and Big Entertainment are all vying for more eyeballs. And the fastest way to obtain them has been via buyout.

Harding-Rolls says “Interest in games from the biggest tech companies has resulted in competitors that have a broad array of technical skills, leading cloud-based capabilities, and very strong financial positions making them formidable opponents…

“Not only is there continued high games industry demand due to the proliferation of companies, storefronts, and services active in the market but there is also increasing demand from adjacent sectors, such as film and TV, that have a growing need for games developer skills.”

That said, Hardin-Rolls believes there will be more acquisitions coming; with at least one potentially valued at $20 billion or more.

Who could be the target?

Read more HERE