Playfish Successfully Sells The Hype To EA For $400mil

It looks like the rumor I reported on back in mid-October was indeed true, and Electronic Arts (ERTS) has purchased London-based, privately held, online social gaming hotness Playfish for even more money than was initially thought. According a company press release this morning, EA paid "approximately" $275mil, plus $25mil in equity retention and $100mil in cash consideration, tied to performance milestones through the end of 2011. $400mil ain't bad for a company started just 2 years ago, by former Glu Mobile exec Kristian Segerstrale, and fueled with $17mil in venture capital just last year, to build simple, casual, addictive gaming titles like "Pet Society" and "Who Has The Biggest Brain?" for social networking platforms (mostly Facebook at this point). They're currently the #2 player behind Zynga, which an anonymous analyst recently suggested to The Business Insider, could be on track to generate $250mil this year (hmm... I'm not so sure). Playfish has only dipped it's toe into the water on the mobile side... it launched "Who Has The Biggest Brain?" on iTunes back in June... but they claim to be (and given Segerstrale's background it's no surprise) big fans of the medium. As I mentioned in my post last month, there's so much hyperbole, froth and irrational exuberance around this space it's a little hard to believe that this transaction is happening at a reasonable valuation and for some EA executives, who were around during the $680mil Jamdat acquisition in 2005, this purchase will have to be feeling (as Yogi Berra would say) like déjà vu all over again. Congratulations to Playfish, you surely gone done your investors proud!