In what would be an unprecedented merger/buyout, there is chatter on Wall Street that Microsoft is in talks to buy Electronic Arts. As you know, EA is the largest game development studio and has been gobbling up smaller companies as well. There is no concrete evidence that this deal is going to happen, but sources say there is definitely “chatter” out there. EA’s share price jumped 4% and Microsoft 0.9% amidst this chatter. IF this were to ever happen, would MS close out sales on its franchises to Sony such as Madden, or would it only allow certain titles to be mulitplatform and keeping the rest for itself?
At roughly the same time this morning, Bethesda and EA dropped some big announcements. Zenimax (the parent company of Betheda) revealed that they’d purchased id Software. EA unveiled their new RPG/MMO studio group, made up of Mythic and BioWare. Didn’t see either of those coming.
So what does this mean for you? Overall, better games. Bethesda makes some kick ass RPG’s and id makes some kick ass shooters. Put them together sharing resources and you can bet the next Fallout and Doom games will be better off. The same goes for new RPG’s coming out of the new conglomerate of Mythic and BioWare. Could we see an MMO in the Mass Effect world?
While the effects of these mergers and acquisitions won’t have immediate effects on what games you’ll be playing, the long term fallout (no pun intended) will make better experiences for you, which is what these companies are striving to achieve.
As the world economy crumbles before our very eyes, big fish are going to continue to eat up little fish wherever they can. Sometimes, this can be good for both fish. The Tecmo fish was gobbled up by the KOEI fish in order to consolidate both Japanese based companies together. Tecmo has been around since the NES years and made some football game people like. You probably never heard of it. It is good to see Tecmo live another day and hopefully they can get back on track and release quality games this coming year.
Earlier this week Bloomberg reported that a large stake holder of Tecmo has voiced some dissent regarding the Japanese merger of Tecmo and Koei. Effissimo Capital Management Pte has made the following statement:
“We have not had sufficient information from the company to make a judgment on the merger, such as the feasibility of their plan to raise shareholder value,” Effissimo Director Takashi Kosaka said in the statement.
No reason to say this merger won’t happen at this point in time. This is just an investor who is concerned about their investment and who are interested in everyone making well informed decisions. Definitely a wise comment to make in the current economic climate. One would hope the Tecmo and Koei management teams will address this and any other investor concerns quickly.
Fans of great games such as City of Heroes and City of Villians will be pleased to know that the developer that brought those titles to us will be financially solvent for years to come. Atari has struck a deal to acquire the small developing studio and this move keeps another very talented group of people in the industry with a much higher budget.
The acquisition of Cryptic Studios brings to Infogrames an outstanding creative organisation, with a proven track-record of success in the fast-growing MMO category,” said David Gardner, CEO of Infogrames/Atari in a statement. “Cryptic’s success is founded on leading-edge technology and the vision of a seasoned executive management team.
The biggest merger that has not happened yet still has much life left as EA extended their deadline which expired last week to another 30 days. No one is surprised. EA is still pursuing the reluctant studio who is still waiting to sell as GTA IV makes history. The announcement quotes Senior VP Owen Mahoney:
Extending our offer will allow the FTC review process to continue. EA’s offer price remains unchanged at $25.74 per share and our offer is still subject to conditions that include regulatory approval. As stated earlier, we retain the right to terminate the offer if the conditions are not satisfied.
EA is no longer the only interested buyer out there. Take Two still feels the offer is inadequate and is talking to other people. Now, this could be a move to drive the price up or maybe they really are looking elsewhere. Take Two had this to say:
This is the same highly conditional proposal that EA offered Take-Two stockholders on March 13, 2008, which our Board of Directors thoroughly reviewed and unanimously determined to be inadequate and contrary to the best interests of Take-Two’s stockholders. As such, the recommendation of our Board of Directors that stockholders not tender their shares to EA remains unchanged. The Board is committed to maximizing stockholder value and is exploring all strategic alternatives to do so. We said we were willing to begin formal discussions with interested parties on April 30, following the launch of Grand Theft Auto IV, and we have in fact begun that process. We are confident in the significant growth potential of Take-Two and in the unique value of our business given our strong position in this growing and dynamic industry.”
Needless to say, you might want to buy some Take Two stock. Someone is going to pay out the ass for it.
Midnight tonight was the deadline for Take 2 to accept the EA takeover bid. EA wants the company before GTA IV releases because it will mean a much lower price. They would also reap the benefits of the vast income that GTA IV will bring in. Take 2, obviously not run by fucking morons, did not balk at the offer.
The tender offer was previously set to expire at 11:59 p.m., EDT, on April 18. The revised offer will expire on May 16, a full two-and-a half weeks after the release of Grand Theft Auto IV.
EA continues to believe that the offer price is full and fair, and that a transaction between Take-Two and EA is the most compelling combination financially, strategically and operationally for all parties,” the company said in a statement.
This is one of those topics that I get tired of writing about and you are probably tired of reading about because these multi-billion dollar pissing contests keeps going on and on. The most predictable things have and will happen. EA will buy Take 2. They won’t do so until GTA IV makes a fuck ton of money. Almost all the video games will be controlled by a company who sucks tremendous balls at DLC. If EA acquires Bungie and/or Epic, I fucking quit.
[via CVG]
Not a week goes by these days without a software company merging with another. These are usually for the better. The mergers will increase revenue and therefore hope to design better games. This merger to me sort of does not make too much sense. Take 2 is on the brink of being bought by EA. Mad Doc software last few Xbox 360 contributions were not all that great. They made that god awful Star Trek: Legacy game. They also completely botched bringing Bully to the Xbox 360. As you can see, my faith in Mad Doc Software is not at an all time high. Furthermore, it seems like a way to help Take 2 software boost their companies value before the inevitable EA takeover sometime after GTA IV brings in about 100 million dollars.
Here is a small, but important update on the proposed EA takeover of Take 2. The board of directors has made a recommendation that the $26 a share buyout price is not enough. They have also asked all their shareholders to hold off on selling until after the release of GTA IV. Take 2 bumped up a meeting to discuss such matters to April 17. This date is only weeks away from the April 29th release date. By then the company will have a very good idea on how much they anticipate the company will be worth after the game sells millions. Here is the official statement from Take 2 on the recent proceedings.
So what the shit is a hostile takeover? Allow me to retort. A hostile takeover is when a company receives an offer to be purchased and the Board of Directors rejects it. The party making the offer, EA, can bypass the Board and appeal to the shareholders. The shareholders can then sell their stock if they wish. Usually the buying price exceeds the present market price. If 51% of the stock is sold, then EA would ipso facto own the company.
So here are the highlights. The 2 Billion dollar offer would have meant that EA would pay $26.00 a share. The current price per share on the day of the offer, Feb 18, was just under $16.00. Needless to say, anyone with major holdings would almost double their current investment. Speculation says that Take 2 is waiting for GTA IV to come out because the projected sales of over 200 million for that quarter will absolutely drive the stock price up considerably. Its tough to say right now, but with the amount of money being thrown around and the present state of the economy, people might dump their stock. One caveat to add is in many companies, the Board members hold a significant amount of stock. The battle of wits has begun.
[via next-gen biz]
Recent Comments