Shares of IronSource Ltd. IS, +47.09% jumped 45% in premarket trades on Wednesday after the business app company agreed to be acquired by Unity Software Inc. in an all-stock deal valued at $4.4 billion.
Unity stock is down about 8.6%. “The companies’ complementary offerings create a unique end-to-end platform that allows creators to create, publish, run, monetize, and grow live games and RT3D content seamlessly,” the companies said. As part of the deal, Unity Software’s private equity backers Silver Lake and Sequoia said they would invest $1 billion in Unity in the form of convertible notes to be issued at the close of the transaction. Under the purchase terms, each ordinary share of IronSource will be exchanged for 0.1089 shares of Unity common stock. The deal values IronSource at a 74% premium to its 30-day average exchange ratio. Separately, Unity’s board OK’d a $2.5 billion share buyback at the close of the deal. Unity stockholders will own 73.5% and current IronSource shareholders will own about 26.5% of the combined company. Unity runs a platform for creating and operating interactive, real-time 3D content. IronSource bills itself as a leading business platform for the app economy.