Here’s your WTF news for the day: SEGA, the former console rival of Nintendo and now home to the Yakuza and Sonic franchises, have just acquired Angry Birds studio Rovio Entertainment for a cool $775 million!

SEGA not only aims to own Angry Birds, but also utilize the studio’s expertise in mobile gaming to bring their “current and new titles to the global gaming market.”

Check out the “background and purpose of acquisition” per SEGA’s statement:

1. Background and purpose of the Acquisition
(1) Positioning of the Consumer business for the Company

The Company positions the Consumer segment of its Entertainment Contents Business as a growth area under its Mid-Term Plan (FY2022/3-FY2024/3), and has accelerated its efforts to strengthen the business through initiatives such as converting existing IPs into global brands, strengthening user engagement through multi-platform support and enhanced media mix, etc.

As a part of its growth strategy to invest up to ¥250 billion during the five-year period ending FY2026/3, the Company has been exploring investment opportunities in the Consumer area to strengthen its development capabilities as well as to create new ecosystems.

In order to strengthen global development capabilities, SEGA has historically acquired numerous development studios, from the UK-based The Creative Assembly Ltd. in 2005, to the Japan-based ATLUS. CO., LTD. (formerly, Index Corporation) in 2013, and the acquired studios have all greatly expanded its scale while also releasing many new titles across the globe.

(2) Background of the Acquisition

The size of the global gaming market is projected to reach US$263.3 billion by 2026, growing at a CAGR of 3.5% from 2022 to 2026. The mobile gaming market in particular, is set to grow at a CAGR of 5.0% to represent 56% of the global gaming market overall, an increase from 53% in 2022. (Source: IDG Report (dated October, 2022))

The Company firmly believes that it is imperative to continue investing in its game development and operating capabilities, in order to further strengthen its position in this fast-growing mobile and global gaming market, which therefore led to the decision to acquire Rovio.

Through the Acquisition, the Company aims to take-in Rovio’s live-operated mobile game development capabilities and expertise in mobile game operation, to accelerate the development of mobile-compatible and multi-platform-supported version of SEGA’s existing game IPs, thereby strengthening and further accelerating global expansion of SEGA’s game portfolio.

(3) Purpose of the acquisition

Rovio is a global mobile-first, games company that creates, develops and publishes mobile games, which have been downloaded over 5 billion times. Rovio is best known for the global Angry Birds brand, which started as a popular mobile game in 2009, and has since evolved from games to various entertainment, anime, and consumer products through brand licensing.

SEGA aims to accelerate its growth in the global gaming market and increase its corporate value by generating synergies between SEGA’s existing businesses and Rovio’s strengths, including its global IPs and live-operated mobile game development capabilities. More specifically, SEGA aims to create synergies with particular focus in the following areas: ·

• Utilization of 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 strongly believes Rovio’s platform, Beacon, holds 20 years of high-level expertise in live service-mobile game operation centered around the United States and Europe

• Rapid expansion of both companies’ fanbase by sharing know-how regarding multi-media expansion of global characters- Rovio and SEGA have both succeeded in extending its IPs, “Angry Birds” and “Sonic the Hedgehog”, to various media outside of video games, such as movies, anime, and merchandising, and accordingly hold a strong fanbase around the world as well as know-how regarding IP expansion

• Support cross-platform expansion of Rovio’s IP using SEGA’s capabilities- Rovio is aiming to expand its platform outside of mobile gaming, and SEGA will actively look to support this process through its capabilities

First off, I didn’t know SEGA had this much scratch to be able to spend that much for one studio. Secondly, it looks like SEGA is buying Rovio more for a global mobile gaming push than Angry Birds, so there’s that.

Once we get wind of the first game announced with the acquisition, we’ll let our readers know.

Source: SEGA Sammy (pdf)