Investors of mobile games maker Zynga (NASDAQ:ZNGA) have just received a nice bump; the company raised $600 million through the sale of its San Francisco headquarters. ZNGA stock is reacting in kind. At present, shares are up 1.27% and selling for $6.27 USD on the NASDAQ.
ZNGA Stock Climbing On $600 Million Raised Capital
Zynga sold its San Francisco premises to an affiliate of private US real estate investment firm, Beacon Capital Partners. And the best part is, it doesn’t even need to leave the building!
The gaming company has signed a lease for more than 12 years, securing its position, and all it needs to do is reduce its presence to 185,000 square feet. Its occupied space is to be revamped and the rest of the building leased by other tenants.
CEO Frank Gibeau, in an interview with Gamesbeat, said the deal was “a nice gain for our shareholders.” The capital will be used for future acquisitions, and, all-in-all, Zynga has come away with a hefty profit (it spent only $234 million buying the building back in 2012).
The CEO furthered:
“The goal is to grow as we’ve done with Gram, Small Giant and Peak […] We’ll invest in running the business, acquisitions and our current buyback program.”
The deal is expected to close at the end of July.
ZNGA Stock Benefits From Zynga Acquisitions
Acquisitions have gone very well for Zynga in the past. In May 2018, it acquired Merge Dragons founder Gram Games for $250 million USD. Only a year on, and the company is reaping the rewards of that acquisition with recent financials showing that Merge Dragons outperformed expectations and brought in 18% of Zynga’s online bookings revenue in Q1.
Further, bookings for the title alone grew 64% in the quarter, having shown the same demand in Q4 2018.
With further acquisitions on the cards, investors could be in line for more gains as ZNGA’s comeback looks set to continue. Shares have already grown over 57% since the beginning of 2019, much in thanks to the success of Merge Dragons, among other titles such as Words with Friends and CSR2.
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