Sega acquires ‘Angry Birds’ maker Rovio 

Fariha Alam

Sega Corp. will acquire Rovio Entertainment Oyj for €706 million, or approximately $776 million, in a move to expand the Japanese video game company’s footing in the mobile gaming business.

The company’s United Kingdom-based branch announced it would acquire the Finland-based video game developer following a board meeting on April 17. The business, which is a subsidiary of Sega Sammy Holdings Inc., is known for creating popular franchises such as “Sonic the Hedgehog,” “Phantasy Star” and “Yakuza.”

Rovio is known for creating the mobile game “Angry Birds,” which has been downloaded more than 5 billion times since its launch in 2009, according to the company’s press release. The game’s success has spawned merchandise and numerous spin-offs, such as the game “Bad Piggies” and a 3-D animated movie adaptation in 2016.

“I grew up playing Sonic the Hedgehog, captivated by its state-of-the-art design,” Rovio CEO Alexandre Pelletier-Normand said in a press release. “Later, when I played Angry Birds for the first time, I knew that gaming had evolved into a true mainstream phenomenon, with the power to shape modern culture.”

Sega has been focusing on its mobile gaming business in recent years with the releases of “Sonic Forces: Speed Battle” and “Chain Chronicle.”

But Sega Sammy Holdings CEO Haruki Satomi said the move is part of the company’s long-term goals as it seeks to “accelerate its expansion in this field” due to its “especially high potential,” according to CNBC.

“[Angry Birds is] loved across the world,” he said in a statement, as reported by CNBC. “I am confident that, through combination of both companies’ brands, characters, fanbase, as well as corporate culture and functionality, there will be significant synergies created going forward.”

As a result of the acquisition, Sega will gain access to Rovio’s popular mobile game franchises, which will help diversify its product offerings and expand its mobile gaming business. Rovio, on the other hand, will have Sega’s expertise in developing and marketing video games, thus helping the Finland-based video game developer.

Despite the worldwide success of “Angry Birds,” Rovio has not been able to garner the same response with its other games. The company was vulnerable to acquisitions by rivals of larger scale. Israel-based digital entertainment company Playtika Holdings Corp. was in talks to acquire Rovio for $800 million, but discussions to advance the deal ended in March, according to The Wall Street Journal.

In recent years, Rovio’s financial performance has been mixed. The company’s revenue peaked in 2017 with €297.2 million, or $326 million, following the release of the “Angry Birds” movie, but it fell to €272.3 million, or $298.7 million, in 2020, according to Statista.

While the titular character of the “Sonic” series represents Sega, Rovio has Red, the lead character in the “Angry Birds” franchise. Pelletier-Normand recognized the two as “globally recognized and iconic” mascots for the companies, and together, “the strengths of Rovio and Sega presents an incredibly exciting future.”

In contrast, Sega reported ¥366.5 billion, or $2.7 billion, in revenue in 2020, according to Statista.