Unity declines AppLovin offer in favor of ironSource merger

Unity has officially declined an unsolicited offer for a merger with AppLovin, recommitting to its existing plan with ironSource.

The proposal: It seemingly came out of nowhere.

• AppLovin came in with an unsolicited offer to merge with Unity on August 9.
• The proposal included an all-stock deal that would, according to AppLovin's estimates, boost the combined company's earnings by more than $500M in 2024 and $700M in 2025.
• Unity has now responded to the offer, confirming that it is committed to seeing through a deal it already had in place with ironSource.
• “The Board continues to believe that the ironSource transaction is compelling and will deliver an opportunity to generate long-term value through the creation of a unique end-to-end platform that allows creators to develop, publish, run, monetize, and grow live games and real-time 3D content seamlessly," said Unity CEO John Riccitiello.

Original plans: Unity already has a deal in place for a merger.

• Announced in July, Unity is planning to merge with ironSource in an all-stock deal.
• Once closed, ironSource will be valued at $4.4B and operate as a subsidiary of the software developer.
• "Beyond our platform, we expect the combination of our business with ironSource to transform Unity’s financial profile to that of a highly profitable and free cash flow positive company," said Unity Chief Financial Officer, Luis Visoso at the time of the announcement.