Mobile Game Developer Backflip Studios Scores $112M from Hasbro
Backflip Studios is joining forces with Hasbro, following a deal in which Hasbro paid $112 million in cash for a 70 percent stake in the Boulder, CO-based mobile game developer.
Hasbro (NASDAQ: HAS) and Backflip Studios announced the deal Monday.
The deal is a huge one for Backflip, which has emerged as a leading mobile game developer. Backflip’s games for iOS and Android have been downloaded more than 300 million times and have more than 30 million active users per month, according to the company. In 2012, its DragonVale title was the top grossing iPad app and fourth top grossing iPhone app.
Other Backflip titles include Ragdoll Blaster, Paper Toss, and Gizmonauts.
Hasbro doesn’t need much of an introduction to anyone who’s ever been, raised, or met a child. Officially, Hasbro bills itself as a “branded play company,” but everyone knows it by its toys and games. The Pawtucket, RI-based company’s lineup is extensive—Transformers, G.I. Joe, Monopoly, and Nerf are only a handful of Hasbro’s products.
The deal puts Backflip’s total valuation at $160 million, a height the company achieved having evidently only raised $145,000 from three investors, according to SEC filings. The investment was made in 2009, the year the company incorporated.
Representatives of Backflip and Hasbro were not available for comment, but a posting from Backflip co-founder and CEO Julian Farrior on the company blog revealed good news from a local perspective.
Backflip will remain in Boulder and the current management team will remain at the helm, Farrior wrote. Backflip’s strategy doesn’t look like it will change.
“We will proceed with our long held strategy of building a large and active network of satisfied users through compelling gameplay,” Farrior’s post said.
“Since the beginning, we have prioritized creating the highest quality product, innovating as the medium evolves and making sure our users are happy. We will remain true to this vision going forward,” he wrote.
Backflip’s most successful games have been titles it has developed from scratch. Under the terms of the deal it can continue to do that, but now it will be able to develop games that cater to the huge fan base Hasbro has built up over many decades.
“In addition to producing original new titles and updating popular favorites, we will now have access to Hasbro’s catalog of well-known brands for future mobile development,” Farrior wrote.
The acquisition of a majority stake in Backflip is inline with Hasbro’s increasing emphasis on mobile games, the release said. The company announced this week it has a four-year agreement with Electronic Arts, which will develop mobile games for several Hasbro brands, including Monopoly, Scrabble, Clue, and Risk.
Hasbro also has a licensing agreement with Rovio Entertainment that allows it to develop toys and games based on Angry Birds.
Hasbro said in the release it expects the addition to have a neutral to small positive financial impact for 2013. Hasbro posted revenue of $4.09 billion in 2012, which was good for a profit of $336 million.