SEGA has acquired Rovio Entertainment, the makers of Angry Birds, for a whopping $775M. The acquisition is part of SEGA’s growth strategy to strengthen its position in the mobile gaming market and create new ecosystems. Find out what this means for the gaming industry and the future of SEGA’s game portfolio.
SEGA has made a surprising move by acquiring Rovio Entertainment, the creators of the globally popular Angry Birds franchise, for $775 million. The acquisition is a part of SEGA’s growth strategy to invest up to ¥250 billion during the five-year period ending FY2026/3 and strengthen its development capabilities as well as create new ecosystems.
Background and Purpose of the Acquisition
SEGA is positioning 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. In order to strengthen global development capabilities, SEGA has historically acquired numerous development studios, from The Creative Assembly Ltd. in 2005 to 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.
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, with the mobile gaming market in particular set to represent 56% of the global gaming market overall, an increase from 53% in 2022. (Source: IDG Report (dated October, 2022)). SEGA 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.
The 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. Through the acquisition, SEGA 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.
