Electronic Arts Outruns Take-Two in Codemasters Race
Electronic Arts said it had reached an agreement to buy Codemasters in a deal worth $1.2 billion, beating rival video games maker Take-Two Interactive Software to the finish line for the British company.
Codemasters shares surged 18.7 percent to $8.63, above EA’s offer of $8.17 per share. UK-based Codemasters, known for its Formula One, DiRT Off-Road Racing, Fast & Furious high-speed action, and Grid video games, said it considered the new bid to be superior to the $6.56 per share offer from Take-Two. Take-Two said it was considering its position.
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“Leveraging our technology, platform expertise, and global reach, will allow us to grow our existing franchises and deliver more industry-defining racing experiences,” said Andrew Wilson, EA’s CEO.
EA’s offer represents a 13.1 percent premium over Codemasters closing share price, and it expects completion of the deal in the first quarter of 2021.
“Codemasters is an attractive asset with a lot of the qualities a consolidator looks for. It has a strategic relationship with NetEase, offering a direct route to the lucrative Chinese market,” analysts said. EA, maker of The Sims, Need for Speed, and FIFA, EA expects the deal to grow net bookings and underlying profitability. UBS Investment Bank is the financial adviser to Electronic Arts, while Jefferies acts as Codemaster’s financial adviser.
Codemasters has been making games for over 30 years, a world leader in the development of racing titles, in particular the DiRT series, and as the official games of Formula One. Their passion is racing games, and their expertise in this genre no doubt led to EA’s acquisition of the company.