Gaming giant Activision Blizzard which producers Call of Duty is set to buy the creator of Candy Crush in a deal worth £3.82 billion.
Activision said the purchase of King Digital Entertainment would "create one of the world's largest entertainment networks" with more than half a billion active users in 196 countries.
Candy Crush is one of the world's most successful mobile games, while Activision boasts huge franchises in its stable which include World of Warcraft.
The combined firm would have more than half a billion monthly active users in 196 countries.
King chief executive Riccardo Zacconi will continue in his role at the firm, along with chief creative officer Sebastian Knutsson, and chief operating officer Stephane Kurgan.
Shareholders in King are set to received £11.66 per share, which represents a 20% premium on the firm's October 30 closing price, Activision said.
Activision Blizzard chief executive Bobby Kotick said that the company wanted to broaden its reach and appeal to a larger demographic.
He said: "With a combined global network of more than half a billion monthly active users, our potential to reach audiences around the world on the device of their choosing enables us to deliver great games to even bigger audiences than ever before."
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