Candy Crush Maker King Digital Prices IPO At $22.50 Per Share – Forbes
King Digital Entertainment, the Irish parent company of the mobile game Candy Crush Saga, has priced its hotly-anticipated initial public offering at the exact midpoint of the expected range, according to a statement on the company’s website posted Tuesday evening.
King, which will be listed on the New York Stock Exchange under the ticker “KING, will begin life as a publicly traded company Wednesday, and sell 22.2 million shares a price of $22.50 per share. In an amended prospectus filed earlier in the month, King said its expected price range for the stock was $21 to $24 per share.
This per-share price means King raised a little under $500 million in its IPO, and gives the company a valuation a little more than $7 billion.
JP Morgan, Credit Suisse and Bank of America Merrill Lynch are acting as lead book-running managers for the offering.
The highly-addictive nature of Candy Crush has propelled King to new heights and fed observers’ excitement for this IPO; in February alone, for instance, Candy Crush garnered 97 million daily active users and over 1 billion daily game-plays. However, it has drawn comparisons to Zynga, the maker of the once-viral but now-passe game Farmville. Zynga IPO’ed in 2011 with a $7 billion valuation, or $10 per share. The stock hit its peak — $14.69 per share — in February 2012, but has remained on a downward path ever since. Zynga currently trades around $5.80 a share, a more-than 40% decline from its stock market debut. Ironically, it was King’s Candy Crush that ousted Farmville as the most-played app on Facebook.
Financial-health ratings company Rapid Ratings, however, likes the looks of King: the ratings company came out with a report on Monday that gave King a financial health rating of 86 (out of 100) based on its solid return on capital expenditures, debt service management and price structure. This is a rating that is both higher than the sector rating, which is at 45.3, and Twitter’s pre-IPO rating of a meager 19 out of 100.
“This suggests that to those for whom King Digital represents an existing exposure,” Rapid Ratings concluded, “and/or for those considering King as a new or increased exposure, such exposure represents a sound risk.”
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