Angry Birds: Sega agrees to buy video game maker Rovio

Video game maker Angry Birds has agreed to be bought by the Japanese game giant behind Sonic the Hedgehog.

Japan’s Sega Sammy Holdings is paying €706m (£625m) to Finland-based Rovio Entertainment.

Rovio said Angry Birds was the first mobile game to be downloaded 1 billion times, and the brand has also produced two Angry Birds movies.

However, Rovio has yet to produce a follow-up to match its success.

This has made him a potential takeover target for major game makers.

Last year, the company — which has about 550 employees across its eight game studios around the world — said downloads across its game portfolio had reached five billion.

Announcing the deal, Sega said its decision to buy Rovio was motivated by the need to “bolster its position” in the global gaming market.

She said that this market is expected to grow to $263.3 billion by 2026, with the proportion of mobile games expected to increase to 56%.

“Among the rapidly growing global game market, the mobile game market has a particularly high potential, and Sega’s long-term goal has been to accelerate its expansion in this field,” said Haruki Satomi, CEO of Sega Sammy Holdings.

“I feel excited to be able to announce such a deal with Rovio, the company that owns Angry Birds beloved around the world and is home to many skilled employees who support the company’s leading mobile game development and play capabilities,” he added.

At the end of trading on Friday, Rovio’s stock market valuation was $707m (£571m).

Sega Sammy is a Japanese global holding company formed by the merger of video game giant Sega and Sammy Corporation in 2004.

Sega has produced several multi-million-selling video game franchises and is known worldwide for its Sonic the Hedgehog character, which has also spawned two movies.

Sami develops and sells amusement arcade machines.