In With its acquisition of PopCap Games, Electronic Arts has made a big push to expand its portfolio into mobile and social gaming. Electronic Arts needed to make such a move as the Console gaming market, where it enjoys a big advantage, is not growing as fast as the gaming market for phones and social media. However, the deal between the two gaming giants was not without its share of high drama.
According to sources close to the deal, Zynga had made a $1 billion in cash offer for acquiring PopGames, but the later turned down the offer in favour of a potentially more lucrative deal from Electronic Arts. Had Zynga managed to bag PopCap, it could have financed the $1 billion amount, at least in part, from the credit line that it has with Goldman Sachs.
That, however, did not happen, and PopCap Games went to Electronic Arts for a potential payout of $1.3 billion. EA has paid $650 million in cash, $100 million in EA stock and it will pay another $550 million based on the performance of the business over the first two years after completion of the deal.
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