On Thursday, Electronic Arts (NASDAQ:EA) significantly ramped up its mobile-game development business. The company announced that its latest major acquisition, for Glu Mobile, has closed.
That deal was reached in February. Under its terms, Electronic Arts agreed to acquire Glu Mobile in an all-cash deal for $2.1 billion in enterprise value.
The new asset should help supercharge Electronic Arts' efforts in the mobile sphere. According to the video game giant, its existing mobile business had roughly 100 million monthly active players. Glu Mobile has an admirably wide variety of titles that appeal to different demographics -- there's little overlap between, say, the company's Kim Kardashian: Hollywood and MLB Tap Sports Baseball.
Electronic Arts quoted its CEO Andrew Wilson as saying that, with Glu Mobile in its portfolio, "We are forming a powerful growth engine that will expand our current games and deliver more amazing new experiences across sports, lifestyle, mid-core, and casual for players everywhere."
Glu Mobile's over 800 employees will join the ranks of Electronic Arts. Of that tally, more than 500 are developers, adding considerable firepower to the new owner's efforts in originating games and refining existing titles.
This was clearly an important deal for Electronic Arts, as the acquisition price represented a 33% premium to Glu Mobile's stock price on the day it was announced.
Electronic Arts is flush with cash, so it shouldn't have any problem funding the arrangement with its own resources. At the end of last year, it held nearly $4.8 billion in cash.
The company's shareholders are happy about the closing of the deal. Its stock was up by 1.5% in late afternoon trading, which topped the 0.7% gain of the S&P 500 index.