Zynga Hoping For $1 Billion IPO

Filed as News on December 2, 2011 1:19 pm

Zynga Dog LogoSocial gaming firm Zynga on Friday filed IPO documents with the Securities & Exchange Commission (SEC) that places the company’s initial price per share between $8.50 and $10.

If that pricing is met the company will have raised between $850 million and $1.15 billion with a total company evaluation of $7 billion.

Those numbers are no small amount, however the company that has created such viral hits as FarmVille, CityVille, and MafiaWars believes they are worth nearly half the valuation of the world’s largest gaming company Activision Blizzard ($14.2 billion).

While $7 billion may seem like a high amount for a relatively new gaming company it should be noted that before pulling their original IPO due to fears of market volatility the company’s valuation was believed to be closer to $10 billion.

While some analysts have mixed feels about Zynga, it’s believed that by selling such a large percentage of the company’s worth during their IPO (14.3% to be exact) they may be able to lessen that volatility.

Zynga has also begun recently to work with new partners, slightly removing their dependence on Facebook. For example several popular Zynga titles can now be played on Google+ and some of their most popular games still reside on mobile devices, specifically the smash hit Hanging With Friends.

Unlike many of their competitors Zynga is also profitable, having taken in $30.7 million in profit for the first three quarters of 2011 reporting.

The company is looking to go public on the NASDAQ by mid-December under the ticker ZNGA.

Do you think Zynga will be able to live up to expectations with a $7 billion valuation?



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