The maker of hit video games including the Grand Theft Auto franchise is to acquire Zynga, best known for its FarmVille and Harry Potter titles, in a $12.7bn (£9.4bn) deal that will create a global console and mobile gaming giant. US-listed Take-Two Interactive said the cash and shares deal will create one of the largest publicly traded interactive entertainment companies in the world. “We are thrilled to announce our transformative transaction with Zynga, which significantly diversifies our business and establishes our leadership position in mobile, the fastest growing segment of the interactive entertainment industry,” said Strauss Zelnick, chair and chief executive of Take-Two, who added that the deal would result in $100m in cost savings in the first two years after its completion. With hits including FarmVille, Zynga was once the most successful developer on Facebook, and subsequently pivoted to mobile gaming to cash in on the boom in smartphone ownership. Despite the entertainment boom during a period of successive Covid lockdowns, Zynga’s share price fell by more than a third last year. It surged by almost 50% when news of the Take-Two deal was announced on Monday. “We are incredibly excited to have found a partner in Take-Two that shares our commitment to investing in our players, amplifying our creative culture and generating more value for stockholders,” said Frank Gibeau, chief executive of Zynga. “With this transformative transaction we begin a new journey which will allow us to create even better games, reach larger audiences and achieve significant growth as a leader in the next era of gaming.” Take-Two, which reported $6.1bn in net bookings in the year to the end of September, said it expects mobile gaming to account for at least half of its net bookings in its next financial year, up from 12% in the current year. The deal is the latest consolidation in the gaming sector in recent years. Take-Two was outbid by rival Electronic Arts in the £1bn takeover of British video games maker Codemasters in 2020. That same year, Microsoft bought the parent of Bethesda, the company behind games including the Fallout and Elder Scrolls franchises, for $7.5bn. In March last year, Epic, the maker of global hit Fortnite, acquired UK-based Mediatonic, the creator of the smash hit Fall Guys. In July, China’s Tencent acquired UK-listed games developer Sumo Group in a deal valuing the business at more than £900m.