Social game leader Zynga poised to file for an IPO?

Zynga, the dominant maker of social games on Facebook, is reportedly poised to file for its initial public offering, according to AllThingsD.

Citing unnamed sources, the publication said that the filing with the Securities and Exchange Commission could come as early as this week or next week.

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The move will give Zynga the option of raising money by going public or continuing negotiations with well-heeled investors who could make private investments in the company.

San Francisco-based Zynga was reportedly raising $500 million on a valuation of $10 billion a couple of months ago, but the round was never announced. Meanwhile, several internet companies such as LinkedIn and Russian search firm Yandex have gone public, showing that investors have a big appetite for fast-growing social media companies.

AllThingsD said that Zynga will likely price itself higher than $10 billion. The company now has a market capitalization of $9 billion, or double its pre-IPO price. Other big social companies preparing for possible IPOs — one of these days — are Groupon and Facebook.

Zynga is the dominant player in Facebook games, with more than 250 million monthly active users. Market analyst firm Appdata says that Zynga’s top game, CityVille, has more than 90 million monthly active users, making it the top game on Facebook. Meanwhile, Zynga dominates the rest of the top ranks with 45 million users for FarmVille, 35 million users for Texas HoldEm Poker, and 14 million players for FrontierVille.

Zynga had the early head start on social gaming on Facebook, but it isn’t as easy to amass a huge audience for a game on the social network now, since Facebook cracked down on spam-like viral messages. Zynga’s numbers have been subject to wild swings as users quit playing or take up new games. In the meantime, though, the company has been enormously profitable. It uses the free-to-play business model, where users play for free and then pay real money for virtual goods such as tractor fuel in FarmVille. Last year, Zynga reportedly generated $850 million in revenue and an operating profit of $400 million. The company has nearly 2,000 employees, and it has acquired 14 game companies in the last 12 months.

Sources told AllThingsD that Goldman Sachs will be among the lead bankers for the Zynga offering. Zynga also reportedly hired John Schappert, chief operating officer of Electronic Arts. That move hasn’t been announced, but sources confirm to us that has happened.

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