What do you get when you combine “Farmville” with “Toy Blast?”
Shares of video game maker Zynga (ZNGA) - Get Report surged on Monday after the company said it has entered into an agreement to buy "Toon Blast" and "Toy Blast" mobile-game maker Peak for $1.8 billion in cash and stock.
Under terms of the deal, Zynga will pay $900 million in cash and an additional $900 million in stock to purchase Istanbul-based Peak, the company said in a statement. The deal is slated to be completed in the third quarter.
The Peak deal will bring Zynga a popular lineup of puzzle games called "Toon Blast" and "Toy Blast." The company is making the acquisition at a time when its business is booming, fueled by consumers staying at home with few live-entertainment options.
While the company expects to see a boost in revenue from the Peak deal, Zynga also expects to post wider losses for its second quarter and full year.
In an accompanying update on its quarter and full-year guidance, Zynga said it now expects to post a second-quarter loss of 17 cents a share vs. a loss of 6 cents, and a full-year loss of 36 cents a share vs. 25 cents.
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