EA Purchase of Jamdat Approved By FTC

The Federal Trade Commission has approved the pending purchase of mobile publisher and developer Jamdat Mobile by game giant Electronic Arts, following a U.S. government review of the deal for anti-trust potential. The investigation has been closed without taking action, leaving EA free to close its purchase of the Los Angeles-headquartered publisher and become a much larger player in the cellphone game market. Once the deal is closed, for a total of close to $680 million, EA will have control over the mobile versions of hit games such as Tetris and Bejeweled, part of Jamdat's mobile portfolio. Under the terms of the deal, Jamdat CEO Mitch Lasky will become the head of EA's worldwide mobile games effort, and will direct the company's efforts in establishing a stronger presence in Europe and Japan, where Jamdat had less of a stronghold compared to its North American profile. Not yet resolved is the the shareholder lawsuit alleging that Jamdat settled for too low an asking price in the EA deal, robbing investors of potential profit. However, it remains to be seen whether the lawsuit will have any effect on the deal, especially since many analysts commented that almost $700 million was a relatively high price for EA to pay for an admittedly important player.