Playtika Holding Corp. shares surged in the extended session Thursday after the Israel-based mobile-games designer said its board is considering a possible sale of the company and released its earnings earlier than expected, beating Wall Street estimates.
shares rallied as much as 17% after hours, following a 4.8% rise in the regular session to close at $18.01.
In a statement, Playtika said “the board intends to consider a full range of strategic alternatives, which could include a sale of the company or other possible transactions.” The company retained the Raine Group as its financial adviser.
“The goal of the strategic evaluation process we are announcing today is to ensure we are taking every step possible to maximize value for our stockholders,” said Robert Antokol, Playtika chair and chief executive, in a statement. “We have always been focused on growing our core business through our investments in people and technology.”
Playtika, which had originally been scheduled to release earnings on March 1, reported fourth-quarter net income of $102.3 million, or 25 cents a share, compared with $76 million, or 19 cents a share, in the year-ago period.
Revenue rose to $649 million to $573.5 million in the year-ago quarter.
Analysts surveyed by FactSet had forecast 18 cents a share on revenue of $636.9 million.
The company’s announcement is the latest development in 2022’s M&A fever in the videogame industry that started with Take-Two Interactive Inc.’s
$12.7 billion offer to buy Zynga Inc.
which was followed up by Microsoft Corp.’s
surprise $69 billion offer for Activision Blizzard Inc.
then Sony Corp.’s
$3.6 billion offer to acquire publisher of the “Destiny” franchise Bungie.
In fact, just last August, Playtika said it planned to acquire design-entertainment company Reworks Oy in a deal valued up to $600 million. Playtika itself went public just a little more than a year ago.
The one videogame publisher that has yet to get caught up in the M&A fever is Electronic Arts Inc.
Over the past 12 months, Playtika shares have fallen 43.7%, while the iShares Expanded Tech-Software Sector ETF
is down 8.8%, the S&P 500 index
is up 9.3%, and the tech-heavy Nasdaq Composite Index
is down 0.9%.