Playtika to Gain From the Acquisition of Israel-Based SuperPlay
Playtika Holding Corp. PLTK is set to acquire an Israel-based mobile gaming company, SuperPlay.
The acquisition is expected to close in the fourth quarter of 2024, upon the satisfaction of customary closing conditions and regulatory approvals. PLTK will acquire SuperPlay for $700 million in up-front consideration, with additional contingent consideration of up to $1.25 billion, subject to SuperPlay achieving certain financial targets for 2025, 2026 and 2027.
PLTK stock gained 1.7% in the after-hours trading session on Wednesday after the buyout announcement.
PLTK’s Benefits From the Strategic Move
Playtika’s product offerings portfolio is expected to witness a revolutionary boost from the acquisition of SuperPlay, especially in the high-growth Coin Looters and Board game categories. By leveraging the successful market presence of SuperPlay, thanks to the two successful game titles, Dice Dreams and Domino Dreams, PLTK will be able to drive growth with scaled titles and unlock new opportunities in mobile gaming.
Per SuperPlay, the Average Daily Active Users (metric measuring the average daily number of unique users interacting with a product or service) for both Dice Dreams and Domino Dreams games were 1.7 million as of August 2024. Such a demand position will prove exceptional for Playtika in expanding its ability to deliver exceptional experiences to global players. Furthermore, the addition of an experienced team and two more top-tier games to the pipeline will be encouraging for PLTK’s growth trends in the upcoming period.
Playtika will be updating its M&A capital allocation and other related guidance for fiscal 2024 in its fiscal third quarter report, per this buyout.
Playtika’s Product Enhancement Efforts
The company regularly undertakes strategic initiatives to ensure sustained growth and profitability in its business. Product enhancements through organic and inorganic initiatives are one of its key strategies to ensure growth.
PLTK recently enhanced its product portfolio with the acquisitions of Animals & Coins and Governor of Poker 3, which have shown consistent growth, quarter over quarter, since the acquisition. Furthermore, the company plans to continue investing in Animals & Coins as it is optimistic about the growth potential.
During the second quarter of 2024, PLTK stated that the majority of growth in sales and marketing spending year over year was related to its newly acquired studios and incremental spending in its largest titles, such as Bingo Blitz and Slotomania. It is looking for opportunities to broaden its game offerings and improve its market position.
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PLTK’s shares have gained 11.2% in the past six months, outperforming the Zacks Gaming industry’s 8.1% growth.
PLTK’s Zacks Rank & Key Picks
Playtika currently carries a Zacks Rank #3 (Hold).
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