The vultures are sighted and closing in rapidly on Vivendi Universal Games, the games division of Vivendi Universal Publishing. Yesterday we reported Vivendi Universal's CEO was contemplating putting the games unit on sale. The division, comprised of four separate studios -- Blizzard Entertainment, Knowledge Adventure, and Sierra Entertainment, and Universal Interactive -- generates about $600 million a year in revenue, which would make it the number three third-party game publisher in the United States, based on the most recently completed fiscal years of the top U.S.-listed publishers. Its heaviest concentrations are in games for the PC, though it produces some console titles as well as performing distribution work for smaller studios.
Vivendi Universal plans on gaining as much as $1.94 billion from the auction, a figure that is "unrealistic and preposterously on the high end" according to several analysts. "They are studios and they will be priced accordingly," an investment banker who has worked with the video game business said.
Only last month Sega said it was actively looking to expand in the U.S. and Europe through acquisitions. Vivendi Universal Games is "one of the more attractive properties that's potentially on the market," said Peter Moore, president of Sega of America. While not specifically addressing a potential acquisition of the Vivendi assets, Moore said Sega would be interested in any property with what he described as quality assets.
Another potential (and the most obvious) buyer would be Microsoft, since that company has $39 billion in cash and short-term investments. Unfortunately Microsoft declined to comment on any possible deal. Sony has not commented either.
Some observers consider Electronic Arts another possible acquirer. As the world's number one independent game publisher, it had $826.9 million in cash and short-term investments on its balance sheet at June 30 and no debt. "As the industry leader and a company with a strong financial position we will study every opportunity carefully," stated EA's Vice President of Corporate Communications Jeff Brown. However Electronic Arts "will not publicly discuss its acquisition strategies," Brown concluded.
Suffice to say that all of the above is speculation, although it comes from respectable financial analysts.
Vivendi Universal plans on gaining as much as $1.94 billion from the auction, a figure that is "unrealistic and preposterously on the high end" according to several analysts. "They are studios and they will be priced accordingly," an investment banker who has worked with the video game business said.
Only last month Sega said it was actively looking to expand in the U.S. and Europe through acquisitions. Vivendi Universal Games is "one of the more attractive properties that's potentially on the market," said Peter Moore, president of Sega of America. While not specifically addressing a potential acquisition of the Vivendi assets, Moore said Sega would be interested in any property with what he described as quality assets.
Another potential (and the most obvious) buyer would be Microsoft, since that company has $39 billion in cash and short-term investments. Unfortunately Microsoft declined to comment on any possible deal. Sony has not commented either.
Some observers consider Electronic Arts another possible acquirer. As the world's number one independent game publisher, it had $826.9 million in cash and short-term investments on its balance sheet at June 30 and no debt. "As the industry leader and a company with a strong financial position we will study every opportunity carefully," stated EA's Vice President of Corporate Communications Jeff Brown. However Electronic Arts "will not publicly discuss its acquisition strategies," Brown concluded.
Suffice to say that all of the above is speculation, although it comes from respectable financial analysts.
