Gaming’s mergers and acquisitions boom is thanks to industry growth

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At GamesBeat Summit, one of the topics was the recent boom in mergers and acquisitions in the games industry. Whether it be the Microsoft-Activision acquisition, or Take-Two’s acquisition of Zynga, these deals are having a huge impact on gaming world.

One of the panels at the Summit, “M&A: Explaining how the gaming world will change,” dove into this topic. Moderated by Alina Soltys of Quantum Tech Partners, the panel featured Frankie Zhu, investment banker at LionTree, and Chris Petrovic, CBO of FunPlus.

At the beginning of the panel, Zhu pointed out that the previous year’s spike in gaming has changed the landscape. “The player engagement and the number of players in the ecosystem has increased permanently. This has largely been a boon for a lot of the IP holders, because they’ve realized how powerful gaming is as a medium to monetize their IP.”

Petrovic also noted that companies are making these investments with growth in mind. “These public companies, like Microsoft and Take-Two, even though they have maybe had their individual different reasons for doing acquisition, ultimated wanted to get access to more scale, wanted to get access to more IP, wanted to get access to more audiences and perhaps a diversified audience across platforms. That’s what the market is rewarding.”

The panel also talked about the future, including whether we’ll see more mergers and acquisitions in the future. Zhu said, “I think right now is an all-time high in terms of gaming innovation, which is expanding the market rapidly. You look at the proliferation of smartphones: Now essentially everyone with a smartphone is a gamer, whether they like