Zynga, whose stock has fallen by more than half in the two years since its initial public offering, disclosed the acquisition as it announced a 43% decrease in fourth-quarter revenue and said it would cut 15% of its own workforce, or about 314 jobs.
The acquisition provides an exit for the Oxford, England-based target's backers, which include Balderton Capital, the leading shareholder with a 24% stake; Balderton's former U.S. sister company, Benchmark Capital, and Oxford University.
NaturalMotion was founded in 2001 and is 8% owned by CEO Torsten Reil, a former Oxford University student who began by designing 3D software to power third-party games and movies before starting to develop games of his own.
Zynga said the purchase expands its lines into people and racing simulation, brings to its portfolio hit titles, including CSR Racing and Clumsy Ninja and increases its presence in the mobile games market.
"We believe that bringing Zynga and NaturalMotion together is the right step at the right time," said Zynga CEO Don Mattrick in a statement. "Our acquisition of NaturalMotion will allow us to significantly expand our creative pipeline, accelerate our mobile growth and bring next-generation technology and tools to Zynga that we believe will fast track our ability to deliver more hit games."