Deal could be worth 10x company's revenue

Popular casual game-maker PopCap Games, known for its hits such as Plants Vs Zombies, Bejeweled and Zuma, is to be acquired by an as-yet-unnamed buyer for $1 billion or more, TechCrunch is reporting. The Seattle company, founded in 2000, has found success in casual games for Mac and Windows and reports annual revenues between $100-150 million per year, making the $1 billion buyout price surprising.

Speculation on the identity of the unnamer buyer is centered around Electronic Arts, which actually entered early buyout talks with PopCap in 2006 but was rebuffed. EA eventually bought Playfish in 2009 for around $400 million, Angry Birds publisher Chillingo in 2010, and recently acquired indie game developer Firemint as well. The company also owns Pogo.com, a popular online gaming site. EA continues to explore mobile and casual gaming with its EA Play label and EAi division.

Longtime rival Zynga is another possibility, but the two companies have a history of animosity towards each other, with PopCap recently buying a smaller competitor ZipZapPlay in order to help fend off market encrouchment from Zynga. Still, Zynga has been actively acquiring both smaller companies and talent in recent months, and absorbing a major rival would be a feather in its cap.

Asian mobile networks such as DeNA or Chinese giant Tencent could also be interested in the company, hoping to acquire its catalog to boost their mobile gaming portfolios. Both companies have large cash reserves and Tencent in particular has both an existing game catalog and a huge market cap ($383 billion), making them a strong possibility.

PopCap Games' current backers include Meritech Capital Partners along with private investors. The company raised $22.5 million in venture funding in late 2009. [via TechCrunch]

by MacNN Staff