Zynga Acquires Challenge Games and Kickstarts Austin Studio

Zynga has acquired Challenge Games, a casual games maker, and is renaming the studio to Zynga Austin. Zynga will add Zynga Austin to their existing offices in San Francisco, Baltimore, Los Angeles, Bangalore and Beijing. Challenge Games is best known for Warstorm, a card game and Ponzi, a tycoon game. Zynga will continue to grow the office, which currently has 35 employees and will also import their games into the growing Zynga catalogue.

Zynga has been making big deals lately, first by partnering with Facebook and agreeing to use Facebook Credits, then making a deal with Yahoo! to have their games distributed across the network, and now acquiring Challenge Games, a well respected casual games company. The terms of the deal were not disclosed, but Challenge is a venture backed company of considerable size that likely wasn’t cheap for a company like Zynga who make an estimated $300 million a year in revenue.

“Austin is an ideal location to extend our studio operations with its rich talent in the games business,” said Mike Verdu, senior vice president of Games at Zynga. “We look forward to building out our Zynga Austin studio with the best and brightest in the industry as we continue to bring social games to more users worldwide.”

Challenge Games’ Co-Founder CEO, Andrew Busey, will become Zynga’s general manager and vice president of the Austin studio. The Challenge Games team of 35 employees will be immediately integrated into Zynga’s workforce. We had the chance to sit down with Andrew Busey at the recent Social Gaming Summit to discuss his company’s direction, and we’ll post that interview shortly.

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