SoftBank buys $1.5bn stake in Finnish mobile games maker Supercell

Japanese tech and telecoms group SoftBank is to buy into Finnish mobile gaming company Supercell in a deal that values the three-year-old maker of hit game Clash of Clans at $3 billion.

SoftBank said it would pay ¥150 billion (€1.13 billion) for a 51 per cent stake in Supercell, with 20 per cent coming from its own mobile games maker subsidiary GungHo Online Entertainment.

Market researcher Newzoo estimates global game revenues across all platforms will reach $86.1 billion by 2016 as the number of gamers reaches 1.55 billion. It expects the fastest growth to come from mobile gaming, which will make up almost 30 per cent of the total, up from about 17 per cent this year.

The deal shows the appetite of Softbank chief executive Masayoshi Son (right) for foreign M&A has not dimmed since his $21.6 billion acquisition of US mobile carrier Sprint this year.

He was quoted on Supercell’s blog as saying the acquisition was part of its “quest to become the #1 mobile internet company”, showing his ambition to expand further beyond its main wireless and internet services business.

The stake acquisition also underscores the spectacular rise of Supercell, a small gaming company with just about 100 employees and two hit games: Clash of Clans and Hay Day.

Supercell, which was founded in 2010, is now more valuable than Zynga, the company behind once-popular games such as FarmVille.

Last year sales at Supercell rose by more than 500 times to €78.4 million compared with 2011, according to a filing by SoftBank, while operating income turned to a profit of €39.2 million compared to a loss of €1.8 million in 2011.

SoftBank now has the third largest market capitalisation in Japan and is set for a major windfall as Alibaba, China's top online retailer in which it owns a 36.7 percent stake, is preparing for a stock market listing. – (Reuters)