Sega agrees to buy Rovio Entertainment, creator of Angry Birds, for $775 million

Japanese video game developer Sega Sammy Holdings Inc. is purchasing Rovio Entertainment, the Finish-based video game developer that created Angry Birds, for about $776 million.

Sega offered $10.17, per share to Rovio shareholders and $1.63, per option to the company’s option holders, a Sega statement released on Monday read. Rovio’s board unanimously recommended shareholders accept the offer, which is supported by 49% of shareholders, including Rovio’s founding Hed family.

The agreement ends talks Rovio was in with multiple parties since an $810 million offer from Israel-based Playtika Holding Corp. was made public earlier this year. Rovio announced on March 22 that it had ended talks with Playtika, but was in continued communications with other parties. Sega’s offer is a premium of 63% compared to Rovio’s closing price on Jan. 19, which was before Playtika’s offer. The offer from Sega is also about 19% relative to the closing price on Friday.

Sega is shifting its main focus to console and smartphone gaming for long-term growth as its traditional businesses of pachinko and arcade machines have suffered declines in audience numbers in recent years, including during COVID-19 pandemic restrictions. 


Japanese video game developer Sega Sammy Holdings Inc. is purchasing Rovio Entertainment Oyj, the Finish-based video game developer that created Angry Birds. (Getty)

Games created by Sega include Sonic the Hedgehog, Crazy Taxi and Yakuza.

Sega said in announcing the deal that its decision to buy Rovio was driven by the need to “strengthen its position” in the global gaming market. The company said this market is projected to grow to $263.3 billion by 2026, with the percentage of mobile gaming expected to increase to 56%, according to BBC.

“Among the rapidly growing global gaming market, the mobile gaming market has especially high potential, and it has been Sega’s long-term goal to accelerate its expansion in this field,” Sega Chief Executive Officer Haruki Satomi said in Monday’s statement. 

“I feel blessed to be able to announce such a transaction with Rovio, a company that owns ‘Angry Birds’, which is loved across the world, and home to many skilled employees that support the company’s industry leading mobile game development and operating capabilities,” he continued.


A model of Angry Birds character “Red” sits on display at the entrance to the Rovio Entertainment Oy headquarters in Espoo, Finland. (Getty)

Rovio’s Angry Birds, the company’s best-known franchise, was released in app stores in 2009. The mobile games generate more than 80% of Rovio’s gross bookings, according to Bloomberg. The game was the first mobile game to reach 1 billion downloads. Following the game’s success, Rovio went public in 2017, with a market value of about $990 million. 

The Finish-based company saw slumps in its first months on the stock exchange after its financial disclosures disappointed shareholders, and the shares never fully recovered the losses.

Rovio developed more than 50 video games in its early years, including Darkest Fear, Cyber Blood and Wolf Moon, before finding huge success with Angry Birds, which was first released for iOS and Maemo devices during a time in which iPhone touchscreen technology was new.

The company has not had the same success with other titles as it has with Angry Birds, which has worried investors. Rovio has looked to expand to other brands and types of games. It has said several new games are in development.

Games created by Sega include Sonic the Hedgehog, Crazy Taxi and Yakuza. (Getty)


Rovio has also acquired smaller rivals and games studios to expand in hyper-casual and puzzle games.

The Angry Birds franchise includes two movies released since 2016 and a Netflix show. Rovio also generates royalties from consumer products.

Last year, Rovio said downloads across its stable of games had reached five billion.

Reuters contributed to this report.