Amazon.com Inc.’s share price up, to acquire Twitch for $970 million

Amazon.com Inc., the worlds second-largest online retailer, announced it has reached an agreement to acquire the leading online video-game broadcasting provider Twitch Interactive Inc. for $980 million.

Twitch.tv is the leading video platform for gamers for both live streaming and on-demand videos (VODs), with more than 55 million monthly active users. In February 2014, The Wall Street Journal ranked Twitch as the 4th largest website in terms of peak internet traffic in the US.

“Broadcasting and watching gameplay is a global phenomenon, and Twitch has built a platform that brings together tens of millions of people each month,” said Jeff Bezos, founder and CEO of Amazon.com. “Like Twitch, we obsess over customers … and we look forward to learning from them and helping them move even faster to build new services for the gaming community.”

The total cost will most likely exceed $1.1bn, as the fast-growing gaming industry and e-sports scene present marketers with a solid and lucrative customer base.

It was said that Google, which also owns the biggest online video platform Youtube.com, was in talks to buy Twitch earlier this year.

“Amazon and Twitch optimize for our customers first and are both believers in the future of gaming,” said Twitch CEO Emmett Shear. “This change will mean great things for our community.” He went on to add that Twitch will not be experiencing radical changes: “We’re keeping most everything the same: our office, our employees, our brand, and most importantly our independence.”

Amazon first delved into the gaming industry with the release of its Fire TV top-box set, which supports gaming. Amazon also purchased game-developer Double Helix and is looking for more studios to design games for their platform.

Amazon.com Inc. was 0.73% up to close at $334.02 per share yesterday, marking a one-year change of +16.07% and valuing the company at $153.21bn. According to CNN Money, the 36 analysts offering 12-month price forecasts for Amazon.com Inc. have a median target of $392.50, with a high estimate of $460.00 and a low estimate of $325.00. The median estimate represents a +17.51% increase from the last price of $334.02.