Candy Crush Saga maker King seeks 500m dollars in IPO - UPDATE

King Digital Entertainment, maker of the massively successful Candy Crush Saga game, said it plans to raise 500m dollars through an initial public offering (IPO) on the New York Stock Exchange (NYSE). The proposed maximum aggregate offering price is $500m. Chief Executive Officer Riccardo Zacconi said the firm had a "substantial cash position and no debt".Dublin-based King said pre-tax profits for the year to December, 31st 2013 were $714m on revenue of $1.89bn compared with a profit of $11m on revenue of $164.4m in 2012. "We have been cash flow positive since 2005. Going public creates a liquid market for our current and future employees and equity holders and will give us greater flexibility to act on strategic opportunities if they arise in the future," Zacconi said in the filing document. "The large majority of our expense base is variable and therefore provides significant financial flexibility. We have built our business with only $9m of primary capital since inception, and have generated positive cash flow from operations for each of the last nine years."Candy Crush Saga, in which players organise "sweets", like jelly beans, in a row, is free to download, but players can buy "extras" to help them progress through the game's various stages. It started as a game on the Facebook social networking site but has now expanded to the smartphone market.King also produces Farm Heroes Saga and Pet Rescue Saga, Papa Pear Saga and Bubble Witch Saga. King acknowledged that a small number of games generated a "substantial proportion" of its revenue."In the fourth quarter of 2013, our top three games Candy Crush Saga, Pet Rescue Saga and Farm Heroes Saga accounted for 95% of our total gross bookings, with Candy Crush Saga accounting for 78% of our total gross bookings or 86% and 58% of our mobile channel and web channel gross bookings, respectively," King said."During 2013, we had fewer games launched on the mobile channel than on the web channel. In future periods, we expect Candy Crush Saga to represent a smaller percentage of our total mobile channel gross bookings as we diversify our mobile game portfolio."The company said an average of 128m daily active users played its games more than 1.2bn times a day in December 2013. In the fourth quarter of 2013, 73% of its gross bookings came from mobile users.The filing also revealed that private equity firm Apax Partners holds a 48.2% stake in the firm, with Index Futures holding 8.3% and Zacconi 10.4% and chairman chairman Melvyn Morris 12.2%.The company said it planned to use KING as its NYSE symbol. Banks, including JPMorgan Chase, Barclays, Credit Suisse, Deutsche Bank and Bank of America Merrill Lynch, are advising King on the offering.FP