• Home
  • Games
  • Games News
  • Electronic Arts to Buy Codemasters in $1.2 Billion Deal to Deliver Better ‘Racing Experiences’

Electronic Arts to Buy Codemasters in $1.2 Billion-Deal to Deliver Better ‘Racing Experiences’

EA CEO Andrew Wilson said the deal will help grow the company’s existing franchises and “deliver more industry-defining racing experiences.”

Share on Facebook Tweet Snapchat Share Reddit Comment
Electronic Arts to Buy Codemasters in $1.2 Billion-Deal to Deliver Better ‘Racing Experiences’

EA, maker of The Sims, Need for Speed, and FIFA, said it expects the deal to grow net bookings

Highlights
  • Codemasters is known for its Formula One games for Playstation 4
  • Take-Two said it was considering its position
  • UBS Investment Bank is acting as financial adviser to Electronic Arts

Electronic Arts said it had reached an agreement to buy Codemasters in a deal worth $1.2 billion (roughly Rs. 8,800 crores), trumping an earlier agreement between the British company and rival Take-Two Interactive.

Shares in London-listed Codemasters surged 18.7 percent to GBP 6.37 (roughly Rs. 600) by 08:45 GMT (2:15pm IST) above the GBP 6.04 (roughly Rs. 580) per share offered to the company's shareholders by EA.

UK-based Codemasters, known for its Formula One games for Playstation 4, said it considered the new offer to be superior to Take-Two's cash-and-stock buyout offer of GBP 4.85 (roughly Rs. 470) per share.

Take-Two said it was considering its position.

California-based EA, as well as rivals Activision Blizzard and Take-Two, have benefited from a surge in videogame sales in the United States fuelled by the trend of people spending more time indoors due to the COVID-19 pandemic.

But that trend could reverse next year as countries begin vaccinating people against COVID-19.

"With the full leverage of EA's technology, platform expertise, and global reach, this combination will allow us to grow our existing franchises and deliver more industry-defining racing experiences," EA Chief Executive Officer Andrew Wilson said.

EA's offer represents a premium of 13.1 percent to the last closing price of the company's shares and it expects the deal to be completed in the first quarter of calendar 2021.

"We think Codemasters is an attractive asset with a lot of the qualities a consolidator might look for... It also has a strategic relationship with Chinese operator NetEase, offering a direct route in the lucrative Chinese market," Citi analysts said.

EA, maker of The Sims, Need for Speed, and FIFA, said it expects the deal to grow net bookings and underlying profitability.

UBS Investment Bank is acting as financial adviser to Electronic Arts, while Jefferies is the financial adviser for Codemasters.

© Thomson Reuters 2020


Is MacBook Air M1 the portable beast of a laptop that you always wanted? We discussed this on Orbital, our weekly technology podcast, which you can subscribe to via Apple Podcasts, Google Podcasts, or RSS, download the episode, or just hit the play button below.

Comments

For the latest tech news and reviews, follow Gadgets 360 on Twitter, Facebook, and Google News. For the latest videos on gadgets and tech, subscribe to our YouTube channel.

Infinix 32X1, Infinix 43X1 Smart TVs With Bezel-Less Screens, HDR10 Support Launched in India

Related Stories

 
 

Advertisement

Advertisement

© Copyright Red Pixels Ventures Limited 2021. All rights reserved.
Listen to the latest songs, only on JioSaavn.com