M&A in the Mobile Games Sector- Who Will Be Next?

©IDG Communications, Inc. Photo contributed by Matthew Mikaelian.

MediaBizBloggers, 12/2/10

October was a busy month for M&A in the iPhone games sector. Ngmoco earned a 10x return for its investors when Japanese mobile game community DeNA paid $400 million. Electronic Arts acquired top iPhone publisher Chillingo for the bargain basement price of $20 million in cash, suggesting that acquisitions in this sector will be small. Now bankers from Hollywood to Herzeliya are wondering if the mobile games sector is entering the start of “exit utopia” or a desperate sell-off? More urgently, who will be next? Below are ten mobile games companies that might be attractive acquisition targets.

First the context- According to Nielsen, the iPhone grabbed 26% of US Smartphone market share in August, surpassing RIM for the first time. Google’s mobile operating system is growing even faster, capturing 32% of the US Smartphone market. Whether iOS (iPhone, iPad and iTouch) or Android, games dominate mobile content. For example, in the past 30 days 61% of US Smartphone owners and 54% of all UK mobile subscribers played a mobile game. As a result, the transition from iPhone to Android is stimulating M&A activity. Expect to see some of the following acquired in 2011:

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