Square Enix Makes $117 Million Bid For Eidos

Square Enix has made an offer to buy UK-based Eidos Interactive, launching a £84.3 million ($117 million) bid for the Tomb Raider publisher. "Eidos has a strong portfolio of established franchises, with highly talented employees," says Eidos CEO Phil Rogers. "Square Enix recognizes this and sees Eidos as both complementary to their business as well as a valuable brand within video games." Reports of acquisition talks have swirled around Eidos for years. Atari owner Infogrames bid for the publisher last year, and Eidos has also been linked to Electronic Arts and Ubisoft. Most recently, existing stakeholder Time Warner looked quite likely to become the publisher's ultimate owner in increments. But Time Warner, which owns 20 percent of Eidos, is contractually obligated to allow the deal unless it were to make an offer of its own. It must accept the recommendation Eidos' Board of Directors plans to make to its shareholders that they take the deal. The Board will convene for the recommendation in March. Eidos' share value has seen a steady decline in recent years as the company's debts slowly mounted. Most recently, the company posted lackluster sales of Underworld, the latest title in its seminal Tomb Raider franchise, and reduced its profit outlook for the year. As for Square Enix, the powerful Japanese Final Fantasy and Dragon Quest house has been in strong suit of Western footholds over the past year or so as it confronts declining market share for Japanese-developed games in the Western market. "Eidos' products are highly complementary to our business and will accelerate our aggressive expansion into Western markets," says Square Enix president Yoichi Wada. "We believe that wide range of both companies' quality products encompassing major genres will enable us to meet diversified customers' expectations upon a global basis."