M&A

Blackstone is acquiring mobile ad company Vungle

Posted by | artificial intelligence, Blackstone, Fundings & Exits, M&A, Mobile, Private Equity, vungle | No Comments

Private equity firm Blackstone just announced that it has reached an agreement to acquire mobile advertising company Vungle.

The companies aren’t disclosing the financial terms, but as part of the transaction, Vungle has also reached a settlement with founder Zain Jaffer, who filed a wrongful termination lawsuit against the company earlier this year.

(Update: Multiple sources with knowledge of the deal said that the acquisition price was around — or north of — $750 million. One of those sources also said it was an all-cash transaction.)

“As a best-in-class performance marketing platform, Vungle represents a key growth engine for the mobile app ecosystem,” said Blackstone principal Sachin Bavishi in a statement. “Our investment will help deliver on the company’s tremendous growth potential and we look forward to partnering with management to extend Vungle’s strength across mobile gaming and other performance brands.”

Meanwhile, CEO Rick Tallman said the deal will allow the company to “further accelerate Vungle’s mission to be the trusted guide for growth and engagement, transforming how users discover and experience mobile apps.”

Vungle was founded back in 2011, and, according to the acquisition release, it’s currently working with 60,000 mobile apps worldwide, serving more than 4 billion video views per month and working with publishers like Rovio, Zynga, Pandora, Microsoft and Scopely.

Jaffer led Vungle as CEO until October 2017, when he was arrested on charges including performing a lewd act upon a child and assault with a deadly weapon. The charges were ultimately dropped, with the San Mateo County District Attorney’s office stating that it did “not believe that there was any sexual conduct by Mr. Jaffer that evening,” while “the injuries were the result of Mr. Jaffer being in a state of unconsciousness caused by prescription medication.”

In his lawsuit, Jaffer alleged that after the charges were dropped, “Vungle unfairly and unlawfully sought to destroy my career, blocked my efforts to sell my own shares or transfer shares to family members, and tried to prevent me from purchasing shares in the Company.”

In a statement today, Jaffer said, he is “pleased with the terms of the settlement, which are confidential.” He also commented on the acquisition:

It is extremely gratifying for me to see our early vision, execution and the hard work of so many talented people rewarded like this. From Day 1, Vungle has been at the forefront of the changing advertising landscape. Today, companies of all sizes, and in all industries, are utilizing in-app video ads as an integral part of their customer acquisition strategies.

The acquisition is expected to close later this year. According to Crunchbase, Vungle previously raised more than $25 million from Crosslink Capital, Thomvest Ventures, Seven Peaks Ventures, GV, AOL Ventures, Uncork Capital, 500 Startups and Angelpad, where the startup was incubated. (AOL Ventures was backed by TechCrunch’s parent company AOL, a.k.a. Oath, a.k.a. Verizon Media.)

 

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AppLovin acquires SafeDK to improve brand safety

Posted by | Advertising Tech, applovin, Fundings & Exits, M&A, Mobile, safedk, Startups | No Comments

Mobile marketing company AppLovin is announcing that it has acquired SafeDK.

While AppLovin started out as a mobile ad business, it now bills itself as “a comprehensive mobile gaming platform,” offering tools for game developers around user acquisition, monetization, analytics and (through Lion Studios, launched last year) publishing. SafeDK, meanwhile, allows developers to manage all the different SDKs on which their apps rely.

Palo Alto-headquartered AppLovin says that by incorporating SafeDK technology, it will help its publishers ensure GDPR compliance and brand safety.

It also says SafeDK will continue to support existing customers, while its headquarters in Herzliya, Israel will become AppLovin’s first office in Israel. Co-founders Orly Shoavi and Ronnie Sternberg will remain on-board as the heads of SafeDK and general managers of AppLovin Israel.

The companies are not disclosing the financial terms of the deal, except to say that it was all-cash. According to Crunchbase, SafeDK has raised a total of $5.8 million from investors, including Samsung Next Tel Aviv, Marius Nacht, StageOne Ventures and Kaedan Capital.

“We are delighted to be working with the AppLovin team to help mobile game publishers grow their businesses,” Shoavi said in a statement. “AppLovin has been a trusted partner for the biggest mobile game studios around the world and SafeDK’s technology will strengthen that trust.”

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Amazon’s Twitch acquired social networking platform Bebo for up to $25M to bolster its esports efforts

Posted by | Amazon, Apps, Bebo, esports, Gaming, M&A, Social, Sports, tournaments, Twitch | No Comments

While Facebook makes a bold move into cryptocurrency to capitalise on its multi-billion user base, a social network that was once a credible competitor to it has quietly been snapped up by a subsidiary of Amazon. TechCrunch has learned and confirmed that Bebo, one of the earlier platforms to let people share thoughts and media with their friends, has been acquired by Twitch, the streaming video platform owned by Amazon. Together the two will be working on building out Twitch’s esports business, and specifically Twitch Rivals.

A spokesperson for Twitch confirmed the acquisition, which includes both people (around 10 employees) and IP, but declined to provide further comment.

From what we understand from our sources, Twitch paid up to $25 million for the company earlier this month, after beating out at least two other bidders, Discord (which itself has been building out its own esports business), and… wait for it… Facebook. (Our source says the latter offered $20 million.) Indeed, LinkedIn profiles for ex-Bebo employees — see here, here, and here — now at Twitch note June as the changeover date. (Note: original sources say $25 million, others close to the deal say it was materially less than this. As you know, these things can be described differently depending on who is doing the describing.)

It has been a long and winding road for Bebo over the years. Starting out way back in 2005 by Michael and Xochi Birch as an early social networking site, Bebo quickly became the market leader in a couple of English-speaking countries, specifically UK and Ireland.

Bebo’s growth trajectory and the bigger opportunity in social were enough to get it acquired for about $850 million by AOL back in 2008, apparently beating out a number of other interested large tech and media companies interested in getting their own social media platform and the audience that would come with it (disclaimer: AOL eventually also acquired TechCrunch, too).

But the deal was a certifiable dud, with Bebo never managing to build on its early traction, and AOL not being in a position to know how to fix that. Less than two years later, it was sold on to Criterion Capital for $25 million.

Yet as the social wheels continued to turn, and even once-global market leader MySpace also fell back as Facebook, Twitter, Instagram and other mobile-friendly platforms pulled out ahead, even that $25 million price turned out to be too high. After Bebo filed for Chapter 11 bankruptcy protection, the original founders, the Birches, bought it back in 2013 for $1 million with a pledge to reinvent it.

And so they did, putting in place a small team led by Shaan Puri, who worked on a number of ideas to see which of them could fly. (And I don’t know if this was a tongue in cheek joke about how challenging they knew the task would be, but it seems that the holding company set up to house some of the IP and legal aspects of the endeavor was called “Pigs in Flight.”)

The new app studio effort, which went by the name Monkey Inferno (another great one), came out of the gates with “Blab”, a “walkie-talkie” ephemeral video messaging service, which picked up millions of users quickly but found it hard to retain them. It shut down a year later, and it looks like Monkey Inferno dabbled in a few other things before coming to esports.

From social networking to socialising esports

In that last pivot, Bebo first tried out streaming services for esports players, but that proved to be tough competition against dominant platforms like OBS and Xsplit. Then, in an interesting nod to its earlier history in social networking and organising groups of friends, it shifted once more, into organising and running tournaments for streamers, with leagues and more: the streams ran on Twitch and Bebo organised viewers, leagues and other things around that.

That site, Bebo.com, is now offline, and all its tweets seem to have been deleted, but the idea was to build out leagues and tournaments for any and all kinds of groups and players, for example complete beginners, or high school students.

It was the last of these that turned out to line up with a growing market segment.

According to a report in eMarketer, esports attracted some 400 million users in 2018 and pulled in revenues of $869 million from sponsorships, player fees and advertising, and it is projected to be worth between $1.58 billion and $2.96 billion by 2022. And Bebo was helping organise and build those communities.

And that is now linking up neatly with Twitch, which had been developing its own casual esports operation in the form of Twitch Rivals. This launched in beta in 2018 and is now widely available wherever Twitch is.

The Bebo tech and its team are now both being put to use on Twitch Rivals, to help continue expanding it with more features and more users. To be clear, though, it seems there is no intention — from what I understand — to parlay Bebo’s past efforts in social networking into a wider social networking play at Twitch: the focus is on esports.

Still, the acquisition comes at a key moment. Since January, there have been reports that Amazon is working on a new game streaming service (just like Apple, Google and others), which likely won’t be out until next year. While there is no news on that today, you can see how expanding the variety and breadth of content on Twitch by way of esports leagues and tournaments fits in with a wider effort to bring more regular, engaged users into the Amazon fold, using this as one of the big draws.

(Updated with more detail on the price.)

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Target Circle and TapHeaven team up in a mobile marketing merger

Posted by | Advertising Tech, Fundings & Exits, M&A, Mobile, Startups, tapheaven, Target Circle, TC | No Comments

Target Circle and TapHeaven announced they’re merging into a single company under the Target Circle brand.

TapHeaven co-founder and CEO Chris Hoyt, who is becoming chief growth officer at the combined organization, said the two companies have been “trying to solve the same problem” — namely, eliminating many of the inefficiencies in the mobile advertising business.

Hoyt said that for Target Circle, that meant trying to “unify this fragmented ecosystem into a single dashboard for contracts, invoices and offers.” And for TapHeaven, that meant a focus on automation, resulting in the launch of what the company calls a “command center” for user acquisition, where advertisers can optimize their ad campaigns “at the source level, by country” while getting high-quality traffic without fraud.

The companies also complement each other geographically — Target Circle is headquartered in Oslo, Norway, while TapHeaven is headquartered in San Francisco.

According to Hoyt, they first came across each other because they were talking to the same mobile studio about supporting the launch of a new game, and it became clear they “both had the same vision for our businesses, the same future with a unified dashboard wrapped in automation and machine learning to simplify and help the ecosystem perform for these advertisers.”

Target Circle founder and CEO Heiko Hildebrandt will continue to serve as chief executive for the combined companies — in the announcement, he said TapHeaven allows the company to “strengthen and expand its technology in the automation of advertising and fraud prevention and resolution.” Meanwhile, TapHeaven executives Brian Krebs and Jeremy Jones will become CIO and chief of user experience, respectively.

The financial terms of the deal were not disclosed. Moving forward, Hoyt said Target Circle will continue to support its existing products while focusing on the new UA Command Center as “the future of our business.” He also suggested that the platform could help advertisers move away from Facebook and Google, allowing them to get the performance they need from other ad networks.

“What impact this is going to have on the market is really lifting up the rest of the ecosystem,” he said. “I feel like Facebook and Google have had their day, a little bit … With the serious things that are going on with these companies, advertisers are desperate for the answers to where [else] can they spend their money and diversify their portfolio.”

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Select FCC leaders announce support for T-Mobile, Sprint merger

Posted by | FCC, M&A, Mobile, Policy, sprint, T-Mobile | No Comments

It’s been more than a year since T-Mobile and Sprint formally announced a merger agreement. This morning, members of FCC leadership have issued statements voicing their support for the $26 billion proposal.

Ajit Pai was first out with a statement, suggesting that the pricey consolidation of two of the Unites States’ largest carriers would help accelerate his longstanding desire to provide more internet coverage to rural areas.

“Demonstrating that 5G will indeed benefit rural Americans,” Pai wrote, “T-Mobile and Sprint have promised that their network would cover at least two-thirds of our nation’s rural population with highs peed, mid-band 5G, which could improve the economy and quality of life in many small towns across the country.”

The FCC chairman went on to suggest that the merger “is in the public interest,” adding that he would recommend fellow members of the commission’s leadership approve it. Commissioner Brendan Carr followed soon after with his own statement of approval, suggesting that a merger would actually increase competition.

“I support the combination of T-Mobile and Sprint because Americans across the country will see more competition and an accelerated buildout of fast, 5G services,” the Commissioner writes. “The proposed transaction will strengthen competition in the U.S. wireless market and provide mobile and in-home broadband access to communities that demand better coverage and more choices.”

A number of ground rules have been laid out for approval. In a bid for approval, Sprint has promised to sell off prepaid brand Boost Mobile. “[W]e have committed to divest Sprint’s Boost pre-paid business to a third party following the closing of the merger,” T-Mobile CEO John Legere said in a blog post following the statements of support. “We’ll work to find a serious, credible, financially capable and independent buyer for all the assets needed to run – and grow – the business, and we’ll make sure that buyer has attractive wholesale arrangements.”

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ServiceNow acqui-hires mobile analytics startup Appsee

Posted by | appsee, Developer, Fundings & Exits, M&A, mergers and acquisitons, Mobile, mobile analytics, ServiceNow, TC | No Comments

In a carefully framed deal, ServiceNow announced this morning that it has acquired the intellectual property and key personnel of mobile analytics company Appsee for an undisclosed price. Under the terms of the deal, the co-founders and R&D team will be joining ServiceNow after the deal closes.

It’s worth noting that ServiceNow did not acquire Appsee’s customers, and the company is expected to wind down its existing business over the next 12 months.

Appsee provides more than pure numerical analytics. As the name it implies, it lets developers see what the user is seeing by recording an interaction and seeing what went right or wrong as the person used the program.

Appsee session playback in action.

GIF courtesy of Appsee

ServiceNow wants to take that functionality and incorporate it into its Now Platform, which enables customers to create customized service applications for their businesses, or use mobile applications it has created out of the box.

The company sees this as a way to improve the UI and build more usable apps. “We’ll be able to use Appsee for our mobile app and browser analytics. This can be used across all three of our workflows, and with this level of visibility our customers will be able to see how customers or employees are engaging [with the application]. With these analytics, ServiceNow will be able to provide insights on user behavior. In turn, this will help us provide an improved UI for customers,” a company spokesperson told TechCrunch.

Just last week at its Knowledge 19 customer conference in Las Vegas, the company announced Now Mobile, a new tool for performing tasks like ordering a new laptop or searching for the holiday calendar, and a mobile on-boarding tool for new employees. Both of these will be available in the company’s next release and could benefit from the Appsee functionality to improve the overall design of these products after it releases them to users.

Appsee has always been focused on capturing user activity. Over the years it has layered on more traditional analytics like DAUs (daily active users) and crash rates, the kind of metrics that can give companies insight into their user experience, but they combine that with the visual record to help see more detail about exactly what was happening, along with myriad other features, all of which will be incorporated into the ServiceNow platform moving forward.

The deal is expected to close by the end of Q2 2019.

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Epic Games is buying the studio behind Rocket League

Posted by | epic games, Gaming, M&A, Psyonix, TC | No Comments

Epic Games is in the process of acquiring the studio behind one of the most popular cross-platform games out there, Rocket League.

The studio behind Fortnite is buying Psyonix for an undisclosed sum and bringing its 132 employees onboard. There doesn’t appear to be a ton changing at the San Diego game studio; Epic says the company will continue to support the game on all platforms.

The real competitive advantage seems to rely on Rocket League coming to the Epic Games store in “late 2019” and ceasing new downloads on Valve’s Steam store at that time, though Epic specifically notes that users that have already downloaded the title on Steam will continue to have support.

The whimsical title has been an unlikely smash success. Rocket League has more than 57 million players, the studio says.

Epic owning two of the biggest cross-platform gaming titles is obviously a major boon to the company, and a sign that they’re committed to ensuring that the studio’s success continues long after Fortnite downloads diminish. This is one of their most important acquisitions to date and brings a cash cow exclusive to their games store, which is continuing to aggressively pursue exclusives as it tries to take down Valve, one of gaming’s biggest powerhouses.

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Ocean drone startup merger spawns Sofar, the DJI of the sea

Posted by | drones, eCommerce, Exit, funding, Fundings & Exits, Gadgets, GreenTech, hardware, M&A, openrov, Recent Funding, science, Startups, TC, underwater drone | No Comments

What lies beneath the murky depths? SolarCity co-founder Peter Rive wants to help you and the scientific community find out. He’s just led a $7 million Series A for Sofar Ocean Technologies, a new startup formed from a merger he orchestrated between underwater drone maker OpenROV and sea sensor developer Spoondrift. Together, they’re teaming up their 1080p Trident drone and solar-powered Spotter sensor to let you collect data above and below the surface. They can help you shoot awesome video footage, track waves and weather, spot fishing and diving spots, inspect boats or infrastructure for damage, monitor acquaculture sites or catch smugglers.

Sofar’s Trident drone (left) and Spotter sensor (right)

“Aerial drones give us a different perspective of something we know pretty well. Ocean drones give us a view at something we don’t really know at all,” former Spoondrift and now Sofar CEO Tim Janssen tells me. “The Trident drone was created for field usage by scientists and is now usable by anyone. This is pushing the barrier towards the unknown.”

But while Rive has a soft spot for the ecological potential of DIY ocean exploration, the sea is crowded with competing drones. There are more expensive professional research-focused devices like the Saildrone, DeepTrekker and SeaOtter-2, as well as plenty of consumer-level devices like the $800 Robosea Biki, $1,000 Fathom ONE and $5,000 iBubble. The $1,700 Sofar Trident, which requires a cord to a surface buoy to power its three hours of dive time and two meters per second speed, sits in the middle of the pack, but Sofar co-founder David Lang things Trident can win with simplicity, robustness and durability. The question is whether Sofar can become the DJI of the water, leading the space, or if it will become just another commoditized hardware maker drowning in knock-offs.

From left: Peter Rive (chairman of Sofar), David Lang (co-founder of OpenROV) and Tim Janssen (co-founder and CEO of Sofar)

Spoondrift launched in 2016 and raised $350,000 to build affordable ocean sensors that can produce climate-tracking data. “These buoys (Spotters) are surprisingly easy to deploy, very light and easy to handle, and can be lowered in the water by hand using a line. As a result, you can deploy them in almost any kind of conditions,” says Dr. Aitana Forcén-Vázquez of MetOcean Solutions.

OpenROV (it stands for Remotely Operated Vehicle) started seven years ago and raised $1.3 million in funding from True Ventures and National Geographic, which was also one of its biggest Trident buyers. “Everyone who has a boat should have an underwater drone for hull inspection. Any dock should have its own weather station with wind and weather sensors,” Sofar’s new chairman Rive declares.

Spotter could unlock data about the ocean at scale

Sofar will need to scale to accomplish Rive’s mission to get enough sensors in the sea to give us more data on the progress of climate change and other ecological issues. “We know very little about our oceans since we have so little data, because putting systems in the ocean is extremely expensive. It can cost millions for sensors and for boats,” he tells me. We gave everyone GPS sensors and cameras and got better maps. The ability to put low-cost sensors on citizens’ rooftops unlocked tons of weather forecasting data. That’s more feasible with Spotter, which costs $4,900 compared to $100,000 for some sea sensors.

Sofar hardware owners do not have to share data back to the startup, but Rive says many customers are eager to. They’ve requested better data portability so they can share with fellow researchers. The startup believes it can find ways to monetize that data in the future, which is partly what attracted the funding from Rive and fellow investors True Ventures and David Sacks’ Craft Ventures. The funding will build up that data business and also help Sofar develop safeguards to make sure its Trident drones don’t go where they shouldn’t. That’s obviously important, given London’s Gatwick airport shutdown due to a trespassing drone.

Spotter can relay weather conditions and other climate data to your phone

“The ultimate mission of the company is to connect humanity to the ocean as we’re mostly conservationists at heart,” Rive concludes. “As more commercialization and business opportunities arise, we’ll have to have conversations about whether those are directly benefiting the ocean. It will be important to have our moral compass facing in the right direction to protect the earth.”

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America Movil acquires Nextel in Brazil for $905M

Posted by | America Móvil, brazil, latin america, M&A, Mobile, nextel brazil, nii | No Comments

Latin America continues to remain a focus for investors that are eyeing up its large population and growth potential. In the latest development, America Movil, the Latin American carrier that is part of the Carlos Slim empire, today announced that it would acquire Nextel in Brazil, owned by NII (formerly Nextel International), for $905 million. NII in turn said that once the deal is closed, it has received approval “to dissolve and wind up NII.”

This is a move to scale up an existing carrier in competition with existing large players like Telefonica (which co-owns Vivo with Portugal Telecom), Telecom Italia and Oi (owned by Telemar). America Movil already has an operation in the country, Claro, which it plans to merge with Nextel to “consolidate its position as one of the leading telecommunication service providers in Brazil, strengthening its mobile network capacity, spectrum portfolio, subscriber base, coverage and quality, particularly in the cities of São Paulo and Rio de Janeiro, the main markets in Brazil.”

America Movil — based out of Mexico — has been on a consolidation spree, swallowing up other smaller holdings in a variety of markets in the region. In January, it acquired Telefonica’s assets in Guatemala and El Salvador respectively for $333 million and $315 million.

The Nextel Brazil deal will include buying a 70 percent stake in the carrier from NII, as well as a remaining 30 percent stake from AI Brazil Holdings BV, NII said today. AI Brazil Holdings is controlled by Len Blavatnik’s Access Industries, the company that owns Warner Music, Deezer and a number of other assets and investments. It had reportedly also been interested in increasing its share in the carrier, before agreeing to sell its stake altogether.

The acquisition is the final chapter for the struggling business, which had originally been the international division of Nextel but had spun out as a separate company before Sprint acquired Nextel in the US in 2005. NII’s focus had been mobile carrier operations across a range of developing markets but it struggled and had been through multiple bankruptcy processes.

“The announcement of this transaction marks the culmination of an extensive multi-year process to pursue a strategic path for Nextel Brazil and provides our best opportunity to monetize our remaining operating assets in light of the competitive landscape in Brazil and long-term need to raise significant capital to fund business operations, debt service and capital expenditures necessary to remain competitive in the future,” stated Dan Freiman, NII’s Chief Financial Officer, in a statement. “Management and our Board of Directors believe the transaction is in the best interest of NII’s stockholders.”

The deal represents a final chapter of sorts for the Nextel brand, which had been a trailblazer in the mobile market through its push-to-talk, walkie-talkie-style mobile service. This was was an early mover in the bigger wave of messaging services that competed with basic carrier SMS, and some came to think of it as the first mobile social network. Over time, though, the iDEN digital network that carried the service became outmoded and most carriers that offered iDEN-based services (including Nextel) discontinued them to focus on 3G and subsequent mobile technologies.

More generally, the acquisition underscores how a number of investors, willing to ride the waves of economic and political ups and downs in Latin America, continue to view the growth opportunities in the region.

NII — which is based out of Reston, VA — was traded on Nasdaq and had a market cap as of last market close, of just $322 million. The company currently has 3.3 million subscribers. But while it was reportedly looking for a buyer of the business in Brazil, its last remaining asset, for some time, this final price — at nearly three times its market cap — is a sign of how some might see locked up value in Nextel Brazil that exceeded all that.

Last week, Paypal and Dragoneer collectively committed $850 million towards MercadoLibre, a marketplace in Argentina. The week before that, SoftBank announced that it would set up a new $2 billion fund to invest in tech companies out of the region, and to help existing portfolio companies to expand there. (By coincidence, the SoftBank venture will be led by Marcelo Claure, who is also executive chairman of Sprint, which swallowed up the US part of Nextel years ago and eventually got acquired by SoftBank.)

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Turtle Beach is buying fellow gaming accessory maker Roccat

Posted by | Gaming, hardware, M&A, roccat, Turtle Beach | No Comments

There was a nice surprise morsel for those following Turtle Beach’s financials this week. In addition to a “record fourth quarter,” the headset maker announced that it has agreed to purchase fellow gaming peripheral company Roccat for $14.8 million in cash.

Turtle Beach is best known for creating gaming headsets for a wide range of different consoles, PCs and mobile devices. Picking up Germany-based Roccat will help the San Diego company further expand into additional peripherals like mice and keyboards. Turtle Beach is also hoping it will help expand its primarily U.S. and Europe-based sales into Asia, where Roccat has already made a dent.

In a press release tied to the news, Turtle Beach CEO Juergen Stark calls the deal “a key step in achieving our goal of building a $100 million PC gaming accessories business in the coming years.”

The complementary nature of the two companies’ product portfolios should certainly go a ways toward helping expand Turtle Beach’s brand. No word, however, on whether the company will continue to maintain the Roccat line in those markets where it’s already found some traction. Certainly that would make a lot of sense in the short term.

Turtle Beach expects the deal to close in Q2.

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