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Business

Zynga founder returns as CEO

The online gaming company Zynga, best known as the maker of FarmVille and Words With Friends, has announced the return of its founder to the firm's top position, two years after he was replaced as chief executive.

Zynga said Mark Pincus would replace outgoing CEO Don Mattrick as the company struggles to become profitable again after posting $225 million (209 million euros) in losses last year.

At $2.60 per share, the company's stock is worth less than a third of the price of its 2011 initial public offering, $10. Zynga has been hit hard in recent years as users moved on to other games and mobile devices.

It brought in Mattrick from Microsoft's entertainment division in an attempt to turn around the company's finances. Over the past two years, Zynga has laid off employees and closed down its China operations to cut costs.

But even as the company increases its mobile user base, it still lost $45 million in the fourth quarter of last year - more than the $36 million it lost in all of 2013.

Zynga did not give a reason

for Mattrick's departure, but the Associated Press cited regulatory findings from last July that said he would only be entitled to severance pay and accelerated vesting of his stock if the company fires him without reason.

A filing on Wednesday revealed that Mattrick would get $4 million in severance pay and accelerated vesting of his 5.1 million unvested stock units worth about $15 million plus the option to buy more. On top of that, he would also receive either $1 million in cash payments or the cash bonus he would have been entitled to otherwise - whichever is less.

cjc/hg (AP, AFP)

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