There's talk that South Korea-based Nexon is offering a bid to take over Electronic Arts.
Looks like someone wants to take over Electronic Arts, and believe it or not, EA stocks are now soaring because it.
South Korean free-to-play MMO publisher Nexon is reportedly talking with Electronic Arts about a potential acquisition. Nexon is a rather big deal over in the East, publishing favorites like Maple Story, Mabinogi, Atlantica Online and Combat Arms which are playable worldwide.
Forbes reports that Nexon, which is currently headquartered in Tokyo, Japan, has seen rapid growth in recent years. It's expecting 2012's revenue to be up 25-percent to $1.4 billion, and profits to rise 53-percent to almost $500 million. The company even raised $1.2 billion last year in Japan's biggest IPO in 2011, and just last week announced that it's looking to purchase mobile game developers.
"There are a lot of good mobile-game developers [being considered for acquisition in Japan]," Nexon Chief Financial Officer Owen Mahoney said in an interview. "The industry is moving in our direction. We’d like to buy teams in intellectual properties early in what we consider to be their total lifetimes and then grow them."
So far there are no confirmations or details surrounding the possible buyout, but EA shares have spiked $1.22 USD, or 8.1-percent, to $16.23 per share. Up until just recently, EA's stock was trading close to a 52-week low as the games publisher struggles to move away from physical distribution to a more modern digital distribution.
EA recently reported a $205 million net loss in fiscal 3Q11 ending December 2011, but also recorded its highest operating cash flow in 31 quarters. During that quarter, EA generated $1.06 billion in net revenue, slightly up from the same quarter in 2010. EA's cash flow from operations was recorded at $475 million.
"We are pleased to report a strong holiday quarter driven by Battlefield 3, FIFA12 and a strong showing by our digital games and services," said Chief Executive Officer John Riccitiello. "Star Wars: The Old Republic is developing a committed community of players with more than 1.7 million active subscribers and growing."
A non-forced buyout will likely not happen based on EA's fiscal 3Q11 numbers alone. But Wedbush Securities analyst Michael Pachter also believes EA's CEO won't even consider handing over control to the overseas publisher.
"There are few, if any synergies, and no reason to believe that Nexon could run EA's assets more efficiently," he said. "Nexon shareholders would own a completely different company than what they bought in the December IPO."
Still, with stocks spiking over a possible buyout, it looks as if shareholders want a definite change to take place soon.
Suddenly loving Nexon!
lol i guess your brain doesn't click much does it
Their problem is a primary focus on net-profit instead of a primary focus on customers. If you have a good product, support it, and treat your customers properly, making money is never an issue because they will come in droves.
Case in point, LOTRO (Turbine) vs SWTOR (EA/Bioware). Played both of these prior to and post launch. LOTRO had minor issues unresolved at launch. SWTOR has had some of the same most glaringly obvious bugs since beta -- in JULY. When they do fix bugs, they often break something else in the process. "We broke battle rez in ops, but at least the rhythm augmentation droid is fixed, right?" Turbine has phone support that in my 3 experiences calling were very fast to answer, were American, and didn't tell you they don't handle anything in game. SWTOR has long hold times, an all foreign call center (though tier 3 support are Canadians, which is fine) and won't handle anything but billing/account issues.
If I spent $60 on the game I wasnt even sure it i will be my only $60 for the same.Instead of getting more free DLC as thankyou, I get more DLC that want more money from me.
Like that's going to fix anything. EA will never change.
So true.
I hope EA becomes more customer focused and puts more time into their Origin BETA project they've imposed on the paying customers.
An example of the terrible Origin implementation is I installed PGA Tour 2012 last night. After the install, Origin would not successfully launch the game. So I tried to launch BF3 and it wouldn't launch either resulting in a hung BF3.exe process. I had to cancel the process through task manager. After repeatedly trying to launch BF3, I had to uninstall and re-install BF3 to successfully pass the 'Logging in...' phase. After the re-install of BF3, I was able to play BF3 and PGA Tour 2012.
I have wasted so many hours re-installing BF3 due to unsuccessful launches coupled with the Origin BETA product's inability to gracefully end its own process when clicking the 'Close Game' button. After the last update, even a reboot won't give me a successful launch of the game. If EA can't even get the launch part of process right with the Origin BETA product, they shouldn't force it on the customer.
Even though MW3 is so remedial in comparison to BF3, it's looking better and better daily due to the lack of hassle Steam gives me.
You know if they hadn't stopped providing new releases on steam then things may not be so bad.......
I suppose if Nexon bought EA and somehow managed to find a way to screw up worse than they did then it would be some sort of poetic justice. EA has been ravaging the games industry for years with their acquisitions. While I don't want to see my gaming options limited, I also would enjoy seeing one of the most anti-consumer companies, EA, fail.
Go Nexon!
I'm not really familiar with EA, as I've only played one of their games (Alice: Madness) in recent years. However, after having played Vindictus (a Nexon published game) for the past year, I wonder if this is such a good idea. Nexon has had non-stop problems with hacking, connectivity issues, and some of the worst customer service I've seen in recent years. For example, it normally takes about 6 months to get back to people about account hacking, but issues with the cash shop are resolved in a few days. I'm not kidding or exaggerating at all - check their forums. This is just Vindictus. To my understanding, their biggest cash cow, Maple Story, has much worse problems.
What about the games they put out? While they are certainly start out strong, within a year the content updates have been lackluster...and that's putting it nicely. A couple new monsters you can fight once a day or three times a week isn't really what I'd call much content. Again, this is only Vindictus, but that is their biggest budget game they've released in years.
Do you really want EA to be bought out by such a company? Perhaps Nexon KR or JP isn't ss bad, but Nexon NA is simply awful. If this sounds like an improvement for EA, then both companies need to tank or learn how to treat their customers properly.
If they can hold on to their Star wars subscribers, it'll turn out to be a big source of cash. Unfortunately, I hear a lot of people are already quitting it.
How can a company that makes $1.2 billion per year in revenue buy a company that makes 1.06 billion per year in revenue. This reminds me of that rapper who wanted to buy RIM.
If they can hold on to their Star wars subscribers, it'll turn out to be a big source of cash. >>>>Fortunately