In a departure from its usual M&A strategy, e-commerce giant Amazon has purchased three-year-old San Francisco-based Twitch, a video platform and online community for gamers, for about $970 million in cash, according to Reuters. The value of the acquisition could exceed $1 billion once executive retention agreements are figured in, a source reportedly told the news service.
The deal, which is expected to close in the second half of the year, represents Amazon CEO Jeff Bezos’ determination to make inroads into sectors that transcend his firm’s core retail business, according to Reuters, which noted that Amazon is used to making either smaller acquisitions or expanding from within.
Reuters notes that this is Amazon’s largest deal ever and could help the company compete with rivals Apple and Google in the booming online gaming market, which “accounts for more than 75% of all mobile app sales,” the news site reported.
It also signifies a special win for Amazon because Google was reportedly in talks to acquire Twitch, says Reuters.