Niantic, known for the global hit Pokémon Go, is negotiating the sale of its gaming division to Scopely, owned by the Saudi Savvy Games Group. According to sources familiar with the negotiations, the potential deal could reach $3.5 billion and could be announced in the coming weeks, Bloomberg reports.
The deal will include the rights to Pokémon Go, the most popular and profitable augmented reality game, as well as other mobile games from Niantic's portfolio. However, the negotiations are still ongoing and there is no guarantee that they will result in a deal.
Launched in 2016, Pokémon Go has become a global phenomenon, encouraging millions of players around the world to explore the environment using augmented reality in search of Pokémon. Despite the enormous success, Niantic has not been able to replicate this level of popularity with other projects. Its game Harry Potter: Wizards Unite was closed in 2022, and in the following years, the company made staff reductions and canceled a number of new projects.
Niantic was founded as a subsidiary of Google in 2015. Its founder and CEO, John Hanke, used to run Google's Geo division (Google Maps, Google Earth). In addition to games, Niantic is also working on augmented reality technologies, creating tools for scanning and creating 3D models of real locations. In November, the company announced the development of a "large geospatial model" that will help analyze scenes from the real world using machine learning.
Scopely, which was acquired by Savvy Games Group for $4.9 billion in 2022, is actively expanding its mobile game portfolio. Savvy CEO Brian Ward has previously stated that the company plans to add a "flagship" mobile game to Scopely's portfolio, which will form the basis of their mobile investment strategy.
In August 2024, Niantic signed an agreement with Savvy to expand its presence in the markets of Saudi Arabia, the UAE, and Egypt.
Savvy Games Group is owned by the Saudi Public Investment Fund (PIF), which is actively investing in the gaming industry as part of the national strategy to diversify the economy.
For Scopely and Savvy Games Group, this deal will be a significant achievement, as Pokémon Go remains one of the most successful AR games in history. This will allow the companies to strengthen their positions in the competitive mobile gaming market.