Electronic Arts Acquires Playfish For Up To $400 Million

There have been rumors circulating over the past month about Playfish, the second largest Facebook Platform developer, being acquired by Electronic Arts. This morning the news was confirmed via a press release stating that:

EA has acquired Playfish for approximately US$275 million in cash and approximately $US25 million in equity retention arrangements. In addition, the sellers are entitled to additional variable cash consideration, up to a maximum of US$100 million, contingent upon the achievement of certain performance milestones through December 31, 2011.

The company, which was funded by Accel Partners, has been a dominant force in the social gaming space, second only to Zynga, which has been the subject of substantial criticism recently. This is a relatively quick exit for the company which is only two and a half years old. The company currently has approximately 60 million monthly active users and growing steadily.

This acquisition is clearly a testament to how hot the social gaming space has become. With approximately three times the number of users, Zynga would be worth approximately $1.2 billion if we were to consider all other things equal aside from the company’s number of users.

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