What would have been the latest $20 billion + valuation merger or acquisition in the video game industry, has been nixed. Unity Technologies, a game engine, has rejected AppLovin’s merger offer and will instead commit to its earlier merger announcement with AppLovin competitor, ironSource.
AppLovin’s offer, submitted Last week to Unity’s board. would have given Unity over half of the outstanding shares of the merged company. The All-stock merger consideration valued Unity at $58.85 per share with a $20 billion enterprise value; a 48% premium to the Unity share price as of market close on July 12.
According to Businesswire, “Under these terms, current Unity shareholders would receive approximately 55.0% of the outstanding shares of the combined company, with the Class A shares representing approximately 49.0% of the outstanding voting rights of the combined company.”
Unity’s board may have considered the deal, but ultimately passed, committing instead to the ironSource deal.
This comes as a blow to AppLovin, as ironSource is a major competitor.
The Unity/ironSource merger, by the way, was announced last month, valuing ironSource at $4.4 billion. This deal, should it go as initially proposed, will involve Silver Lake and Sequoia, Unity’s two largest shareholders, investing an additional $1 billion.
This merger deal would be neither ironSource’s nor Unity’s first deal of the year. Back in January, ironSource acquired Tapjoy for $400 million, while Unity acquired Ziva Dynamics for an undisclosed sum.
Unity CEO, John Riccitiello said, “The Board continues to believe that the ironSource transaction is compelling and will deliver an opportunity to generate long-term value through the creation of a unique end-to-end platform that allows creators to develop, publish, run, monetize and grow live games and real-time 3D content seamlessly.”
2022 has already been a record-breaking year for deals in the video game industry, and many more deals are expected. Is AppLovin still on the hunt for a merger or possibly an acquisition deal before the year is out?
Read the full details on the Unity rejection of AppLovin, HERE
Or discover other potential merger and acquisition deals, HERE
Source: https://techcrunch.com/2022/08/15/unity-rejects-applovins-20-billion-merger-offer/