Three Firms Advise on SoftBank's $1.5 Billion Game Deal

Japanese Internet and telecommunications group SoftBank Corp. has agreed to pay $1.5 billion to buy a majority stake in Finnish online gaming company Supercell.

SoftBank said Tuesday it is teaming with a Japanese game company it owns part of, GungHo Online, to acquire 51 percent of Supercell, which makes the online games “Clash of Clans” and “Hay Day” for smartphones and tablet computers. The deal’s terms call for GungHo to invest $300 million and SoftBank to put up the remaining $1.2 billion for the controlling interest in Supercell. The deal is expected to close no later than early November.

In a statement announcing the deal, Softbank said it is trying to establish itself as the “No. 1 mobile Internet company” in the wake of its $21.6 billion acquisition of Sprint Nextel, in a deal that closed earlier this year. The acquisition of Supercell is likely to help Softbank expand its presence in the mobile gaming market, given that the Helsinki-based game producer has seen its earnings explode in the course of the past year. According to TechCrunch, Supercell grossed $100 million last year, but was earning $2.4 million per day as of April 2013.

In a blog post released Tuesday, Supercell CEO Ilkka Paananen wrote that the SoftBank investment will give his company access to greater resources and a global customer base.

Morrison & Foerster is advising SoftBank and GungHo on the matter with a Tokyo-based team that includes M&A partner Kenneth Siegel, who serves as managing partner of the firm’s Tokyo office, as well as M&A partners Randy Laxer and Gary Smith. The firm also advised SoftBank on its purchase of Sprint Nextel as well as on a $3.3 billion debt offering on the Singapore Exchange in June.

Fenwick & West is acting as Supercell’s lead counsel on the transaction, while White & Case is serving as local counsel in Helsinki. Fenwick’s team is led by Mountain View, California–based corporate partner Mark Stevens, who cochairs the firm’s gaming and digital media industry group. Corporate partners R. Gregory Roussel and David Michaels are also advising, along with technology transactions partner Stephen Gillespie, employee benefits partner Scott Spector, and tax partner David Forst. Fenwick associates on the deal are Scott Behar, Jay Cosel, Katherine Duncan, Marshall Mort, and Matthew Stewart.