EA looking for a buyer
Ryan Martin / 4 years ago
Electronic Arts is reportedly looking for a new buyer. The firm has been in contact with private-equity companies KKR and Providence Equity Partners although discussions are reportedly still in a very early stage.
Share value in EA has dropped 37 percent this year although the stock closed up 5.5 percent yesterday at $13.81 following buyout speculation.The company’s market cap is at $4 billion as of writing and one source says they would take a deal for $20 per share. EA has been buying back its stock from investors recently, possibly as an early move preparing the way for the new deal.
EA needs the buyout because it hasn’t had much success as of late, and could encounter financial troubles. Tumbling stock prices, dwindling game sales and an overall decline in the gaming industry have all worked against them. Thus the takeover is necessary for the future viability of EA, cost cutting measures could be on the way.
According to TechSpot “EA told the Post they don’t comment on rumors and speculation while Henry Kravis from KKR declined to comment. Representative Jonathan Nelson from Providence did not return the publication’s calls for comment.”
Activision-Blizzard also went through a similar process earlier in the year but it didn’t lead to anything.