Sega acquires Angry Birds maker Rovio for $775M

Sega will acquire Rovio (the Finnish company that created the Angry Birds video games) for about three-quarters of a million dollars. The company made the announcement on Monday. The Wall Street Journal reported that the deal was close to being completed on Friday. However, it had predicted a price of $1 billion.

Sega made it clear that it was looking to strengthen its position in the mobile gaming market, and to use Rovio’s expertise to bring Sega’s own intellectual property — which includes Sonic the Hedgehog, of course — to mobile in a major way.

The deal, which has been approved by Rovio’s board and shareholders, puts a €706 million ($775 million) price tag on the Angry Birds studio. Sega anticipates completing the acquisition before the end of 2023. Rovio is now part of Sega Europe. This UK-based company also includes studios such as Creative Assembly (Total War), Sports Interactive (Football Manager) and Sports Interactive.

In a press release, Sega said it expects mobile gaming to grow to 56% of the overall gaming market by 2026, and that it aims to use “Rovio’s distinctive know-how in live service mobile game operation to bring Sega’s current and new titles to the global mobile gaming market, where there is large potential, and many users can be accessed.”

Sega has said that it will assist Rovio in expanding beyond mobile gaming, and launching its games across other platforms. Both companies were also cited as having been successful in the multi-media realm. Sonic the Hedgehog and Angry Birds have made it to the movie theaters.

Rovio’s original 2009 Angry BirdsIt was among the first smash hits on mobile phones, and it became the basis for a franchise of casual puzzle games. Rovio is still struggling to move beyond the Angry Birds brand. The studio released its first video earlier this year. courted controversyWhen it delisted and renamed the paid-for game originally available on Android as Red’s First FlightOn iOS, it dominated app store searches. Depending who you listen to, the $0.99 price tag was either a way for players to avoid later free-to-play games, or (as Rovio said in an interview with Axios), it prevented them from ever downloading Angry Birds.

Sega’s move shows that the acquisition spree that has gripped the video game industry for the past few years is still going, even if it has slowed. Cheap capital and rapid growth during the pandemic has led to huge deals such as Sony’s $3.6 billion acquisition of Bungie and the still-ongoing saga of Microsoft’s $68.7 billion purchase of Activision Blizzard.