The stock of Playtika, the mobile online gaming company surged in its first day of trading after its initial public offering was priced well above estimates. Playtika’s mission is to entertain the world with a diverse portfolio of games. Each game will have more and more resources and content over time so that the game is endless.
The Israeli company said last week it planned to raise $1.6 billion via the IPO, with shares priced at $22 to $24, valuing the firm at $8.6 billion to $9.4 billion. The terms changed rapidly as demand surged. Shares were priced at $27, resulting in Playtika raising $1.88 billion. That values the company at $11.1 billion. In midday trading, the stock was around $33 and earlier traded as high as $36.
The IPO for the firm consists of 69.50 million shares with the company offering 18.51 and 50.98 million sold by Playtika Holding UK. The entity is controlled by Chinese investors that purchased the gaming company in 2016 for $4.4 billion. The Playtika IPO is an example of the interest in mobile gaming companies by investors in the sector. The interest in the company is despite recent controversy surrounding US-listed Chinese companies.
According to Reuters, “Playtika’s IPO comes as US-listed Chinese firms face tightened scrutiny and strict audit norms from US regulators and a week after the New York Stock Exchange decided to delist three Chinese telecom companies,”
Playtika is growing in leaps and bounds. The 12 months ending Sept. 30, 2020, resulted in revenue of $2.28 billion. It is important to note the company had net income over that period, proving it’s profitable, which is rare for companies in this sector. Playtika has 35 million active monthly users and is the company behind nine of the top 100 highest-grossing games in the major app stores.
