Mobile-Game Maker Playtika Rises After Israel-Record IPO

(Bloomberg) -- Mobile-games company Playtika Holding Corp. rose in its trading debut after raising $1.88 billion in an initial public offering, the biggest listing ever by an Israel-based company.

Playtika’s shares, which rose as much as 34% Friday, closed up 17% to $31.62 in New York trading, giving the company a market value of about $13 billion.

The company and its main owner, a China-based investor, sold 69.5 million shares Thursday for $27 apiece. Playtika had marketed the shares for $22 to $24.

Playtika Chief Executive Officer Robert Antokol said in an interview that the proceeds of the IPO could fuel acquisitions of other companies as well as internal game development.

“This is the right time to go public because we want to make the next jump for our growth,” he said.

Gaming Boom

Playtika is going public on the coattails of a gaming-industry boom. With consumers stuck at home more due to the Covid-19 pandemic, digital-game revenue rose 12% last year, to $126.6 billion, according to researcher SuperData.

Mobile games grew 10%, and accounted for nearly 60% of the total market. As it could take months more for life to normalize, many analysts say increased gameplay is expected to continue for much of this year as well.

“The gaming space showed that it’s a very strong sector, it’s a very growing sector,” Antokol said. “Investors are already looking at the sector differently than they were a few years ago.”

Mobile gaming company Skillz Inc. went public via special purpose acquisition companies last year and Roblox Corp. is planning a direct listing soon.

Playtika had net income of $16 million on revenue of $1.8 billion for the nine months ended Sept. 30, according to its filings with the U.S. Securities and Exchange Commission. That compares with net income of $259 million on revenue of $1.4 billion during the same period in 2019.

Chinese investors bought Playtika from Caesars Entertainment Corp. for $4.4 billion in 2016. After the IPO, Playtika will continue to be ultimately controlled by the Chinese company Giant Investment Co., which in turn is controlled by Yuzhu Shi, according to the filings.

The offering was led by Morgan Stanley, Credit Suisse Group AG, Citigroup Inc., Goldman Sachs Group Inc., UBS Group AG and Bank of America Corp. The company’s shares are trading on the Nasdaq Global Select Market under the symbol PLTK.

(Updates with closing share price in second paragraph)