US video game giant buys into France's Ubisoft

20th December 2004, Comments 0 comments

PARIS, Dec 20 (AFP) - The US group Electronic Arts, the world's largest video games maker, said Monday it had acquired 19.9 percent of French rival Ubisoft Entertainment from Talpa Beheer for an undisclosed sum.

PARIS, Dec 20 (AFP) - The US group Electronic Arts, the world's largest video games maker, said Monday it had acquired 19.9 percent of French rival Ubisoft Entertainment from Talpa Beheer for an undisclosed sum.

The whole of Ubisoft is worth about EUR 300 million (USD 401 million) based on the EUR 16.98 closing price of its shares on Euronext Paris on Friday.

California-based Electronic Arts said the share purchase, carried out in one block, would be completed when antitrust clearance was obtained from the US government.

Talpa Beheer is the investment vehicle of Dutch financier John de Mol, co-founder of TV company Endemol, which pioneered reality TV with the "Big Brother" programme, in which cameras monitor the lives of strangers cooped up in restricted accommodation.

Talpa was reported early in 2004 to have raised its stake in Ubisoft to 10.5 percent.

Electronic Arts becomes Ubisoft's largest shareholder, followed by the company's founders who have a combined stake of 15 percent, according to Ubisoft's website. French bank Caisse des Depots et Consignations has a six-percent interest.

Shares in Ubi Soft shot up 16.61 percent to EUR 19.80 in mid-morning trading on the Paris Bourse.

Electronic Arts last month offered to acquire the 81 percent it does not already hold in Swedish game developer Digital Illusions for undisclosed terms.

Electronic Arts was estimated at that time have more than USD 2 billion (EUR 1.5 billion) in cash in hand, according to analyst Michael Pachter of Wedbush Morgan.

The company, which employs 5,000 people, had sales this year of about USD 3 billion (EUR 2.2 billion) and net earnings of USD 577 million (EUR 430 million).

Ubisoft last week announced that its net loss had widened to EUR 36.5 million under French accounting standards in the six months to September from EUR 34.4 million a year earlier and to EUR 43 million US GAAP standards from EUR 32.1 million previously.

Sales edged up to EUR 130 million in the first half from EUR 128.8 million in the prior year.

Ubisoft predicted full-year profit before tax and interest of EUR 40-45 million French standards and EUR 38-43 million under US rules. Net profit before exceptionals is seen at EUR 18-22 million according to French GAAP and at EUR 17-21 million using the US guidelines.

© AFP

Subject: French News

0 Comments To This Article