NEW YORK (The Deal) -- Mobile game publisher King Digital Entertainment said it could raise upwards of $612.7 million in an initial public offering that would value the maker of Candy Crush Saga at $7.6 billion.
The Dublin-based company said in a regulatory filing that it expects to sell 22.2 million shares at between $21 and $24 per share on the New York Stock Exchange in an offering that is expected to price before the end of the month. The company will sell 15.5 million shares in the offering, while existing holders including Apax Partners and Index Ventures will sell the remainder.
Post-deal Apax would own 44% of the company while CEO Riccardo Zacconi would have a 9.5% stake.
King Digital has become a hot topic of discussion among investors arguing whether the broader market has become overvalued. Bulls point to Candy Crush's strong growth, having been downloaded more than 500 million times since 2012 and ranking as the top revenue grossing app in 2013.Bears worry the market is overvaluing what could be a one-hit wonder, pointing at rival game maker Zynga (ZNGA - Get Report). That company went public in 2011 at $10 a share but now trades at about half of that value. King in its filing notes that just three games account for 95% of its total gross bookings and said "our continued growth will depend on our ability to regularly develop news games and enhance our existing games." JPMorgan Chase (JPM - Get Report), Credit Suisse Group AG and Bank of America Merrill Lynch (BAC - Get Report) are lead underwriters for the offering, joined by Barclays, Deutsche Bank Securities Inc., RBC Capital Markets, BMO Capital Markets, Cowen and Co., Pacific Crest Securities, Piper Jaffray, Stifel, Wedbush Securities and Raine Securities.
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