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Zynga Spent $53.3M To Acquire  Words With Friends  Maker Newtoy

Zynga Spent $53.3M To Acquire Words With Friends Maker Newtoy

July 5, 2011 | By Kyle Orland

Social gaming giant Zynga spent $53.3 million when it bought Words With Friends maker Newtoy last December, the largest in a string of acquisitions enumerated in a recent IPO filing.

As noted by VentureBeat, the renamed Zynga With Friends saw its daily audience for Words With Friends double after the acquisition, which raised Zynga's profile in the mobile space signficantly.

The developer has since released Hanging With Friends, which last month shot to the top of the iOS App Charts thanks to heavy cross-promotion from other Zynga titles.

The outlay for Newtoy exceeds the $48.4 million Zynga spent to acquire six other companies in 2010, including Japanese social developer Unoh, Austin's Challenge Games and Dallas-based Bonfire.

Zynga spent an additional $10.5 million to acquire four more companies in the first quarter of 2011, and $10.8 million for five more companies in the second quarter of the year, bringing the 18-month total spend to $123 million for 12 companies.

All this acquisition spending was a drop in the bucket compared to non-GAAP revenues of $583 million for 2010 alone, and a company valuation that could be as high as $20 billion once Zynga's stock begins trading publicly.

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