Mega games company Activision Blizzard, Inc. has acquired Candy Crush Saga maker King Digital Entertainment PLC for a cool $5.9 billion.

According to The Financial Times, the acquisition is the biggest takeover of a UK-based tech company since HP acquired Autonomy for $11 billion four years ago.

The deal is said to give the combined companies more than 500m monthly active users across almost 200 countries, will boost Activision’s adjusted earnings by around 30 per cent next year, and represents a 26 percent premium to King’s $4.7bn market capitalization as of the close of trading on Monday.

King was founded in 2003 and primarily focuses on social gaming, offering a range of games including the still seriously popular Candy Crush Saga; other games among the 180 the company offers in 14 languages include Farm Heroes Saga, Papa Pear Saga, Pet Rescue Saga and Bubble Witch Saga.

Activision Blizzard, the company itself the result of a merger in 2008, primarily offers console and PC games including World of Warcraft, Call of Duty, Starcraft and others.

The company explained the acquisition in a press release, stating:

Activision Blizzard believes that the addition of King’s highly-complementary business will position Activision Blizzard as a global leader in interactive entertainment across mobile, console and PC platforms, and positions the company for future growth. The combined company will have a world-class interactive entertainment portfolio of top-performing franchises, including two of the top five highest-grossing mobile games in the U.S. (Candy Crush Saga®, Candy Crush Soda Saga™), the world’s most successful console game franchise (Call of Duty®), and the world’s most successful personal computing franchise (World of Warcraft®), as well as such well known franchises as Blizzard Entertainment’s Hearthstone®: Heroes of Warcraft™, StarCraft®, and Diablo® and Activision Publishing’s Guitar Hero®, Skylanders® and Destiny, along with over 1,000 game titles in its library.

Activision Chief Executive Officer Bobby Kotick added:

The combined revenues and profits solidify our position as the largest, most profitable standalone company in interactive entertainment. With a combined global network of more than half a billion monthly active users, our potential to reach audiences around the world on the device of their choosing enables us to deliver great games to even bigger audiences than ever before.

Fad risk

There’s no question that King currently offers the most popular and lucrative social media franchise in the world, but the problem lies with the fact that they’re not the first to be in this position, and they most definitely won’t be the last; it wasn’t that long ago that games like Farmville and Angry Birds held the same position and the developers of both games have since fallen on hard times as their games have dropped from the same position King currently holds with Candy Crush.

It’s understandable that one of the biggest gaming houses on the planet wants to own a slice of the social gaming market, but the challenge going forward will be to leverage the experience of both companies to deliver new, perhaps even market leading games for a fickle generation that is always looking for the next big thing.

The deal is naturally subject to shareholder and regulatory approval, however a date for when it will be finalized was not given.

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