EA has confirmed the rumors that PopCap has joined the Collective. Citing studio talent and strong IP, PopCap was purchased by EA for $750 million. The transaction is expected to close in August, 2011.
According to this Gamasutra report, EA will pay approximately $650 million in cash and $100 million in EA common stock to be issued to PopCap shareholders, the company said. In addition, the company may pay additional funds of up to $550 million based on performance milestones through 2013.
Earlier this year, PopCap was leaning towards an IPO. Out of the blue, it seemed, this purchase venture came about. But was it in actuality foreseen? Over the past several years PopCap has been moving into a more global environment, especially China. A clue to why PopCap chose a purchase rather than an IPO can be seen in this statement by PopCap CEO David Roberts:
“We picked EA because they have recast their culture around making great digital games. By working with EA, we’ll scale our games and services to deliver more social, mobile, casual fun to an even bigger, global audience.”
We suspect that PopCap determined that working with a company that already had a strong global infrastructure, especially in Asia, rather than trying to create their own, was a better idea.
The big question on many minds now is how much independence as a studio PopCap will have under EA’s wing? Will EA appreciate PopCap’s development methods and longer cycles? PopCap takes a methodology similar to Blizzard…the game is done when it is done. This is certainly not EA’s view. Only time will tell what kind of an impact on development this will have for PopCap.
But certainly the financial impact is most positive, and being felt now.