Unity Software rejects AppLovin merger proposal

Unity Software Inc. rejected an unsolicited proposal to merge with AppLovin Corp. in an all-stock deal.

Unity on Monday recommended shareholders vote against the AppLovin deal and instead vote in favor of Unity’s planned deal to buy ironSource Ltd. for $4.4 billion, a merger that was agreed upon last month.

“We remain committed to and enthusiastic about Unity’s agreement with ironSource and the substantial benefits it will create for our shareholders and Unity creators,” Unity Chief Executive Officer John Riccitiello said in a statement.

Shares of Unity fell 7% to $54.38, while AppLovin shares fell 6.7% to $33.89. Shares of ironSource, meanwhile, jumped nearly 12% to $4.49.