Rumors of a deal between Amazon and Electronic Arts have been circulating on social media, claiming that the video game publisher was in the market for a buyout option from the multinational company.
According to the unconfirmed reports, Amazon made a bid for the gaming company earlier on and planned on announcing its offer to acquire EA not long after. The gaming company was reportedly exploring options to help them along with Ubisoft, and the rumored deal with Amazon could provide the extra hands the game publisher needs.
If the offer is confirmed, Amazon will automatically have a significant spot in the esports industry as a result of acquiring the company that developed popular esports titles like Battlefield, Apex Legends, Madden NFL, FIFA and several other titles. EA notably owns several big studios like DICE, Respawn Entertainment, and BioWare. The company also has a distribution platform online called Origin.
The news led to the mobile gaming company’s hike in stock price, which was reduced when contradictory comments from CNBC sources revealed that there was no acquisition in the works between the two companies.
The information, via a CNBC reporter, claimed insiders disclosed that there were no plans to acquire EA by Amazon. He said, “I have talked to some people who would actually know if there’s something going on, and they say there’s nothing going on.”
The new information could be in a bid to stop the previously bloated stock price of EA in order for the company’s bidders not to be placed at risk. Only time will reveal if the deal actually falls through. However, if it’s successful, both parties will benefit from it.
While the company has remained financially stable in recent years, EA has not had the best of times due to harsh criticism directed at many of the developer’s franchises by dissatisfied fans. If the Amazon acquisition happens, the multinational company will gain the rights to EA’s notable franchises.
As a result of the number of films and television shows based on video games, the multinational company will be able to coordinate the EA titles with its future plans for its streaming platform, Prime Video. EA will also benefit from the sizable influx of cash generated by the acquisition and gain several solid networks due to the technology company’s leverage in the industry.
Several takeovers and acquisitions occurred this year in the gaming sector, starting with the proposed $68.7 billion acquisition by Microsoft of Activision Blizzard. Not long after, PlayStation announced that they had acquired Bungie and Embracer Group, notably buying out several IPs and video game companies. Take-Two and Zynga also reported a $12.7 billion merger.
Prior to the rumors of the Amazon-EA acquisition, the CEO of Acquisition Blizzard, Bobby Kotick, revealed that the company was contemplating a merger with the Apex Legends developer, which would have made the duo a sizable entity. The news was made before Microsoft made moves to acquire Activision Blizzard.
EA also reportedly held talks with companies like Apple, Disney, and Comcast-NBC Universal concerning a possible sale. The news claimed that insiders revealed that the gaming company had made several moves to secure a sale and had “only grown more emboldened in the wake of the Microsoft–Activision deal.”
It continued: “Others say that EA is primarily interested in a merger arrangement that would allow [CEO Andrew] Wilson to remain as chief executive of the combined company.”
Andrew Wilson, the CEO of EA, was reportedly asked about the possibility of the company being acquired by another entity during a quarterly earnings call with EA’s investors and shareholders.
The CEO claimed that the company was in a great position at the moment and he was “very confident and excited” about the company’s future. He, however, did not rule out the possibility of outside offers to acquire the company.
Wilson concluded his speech with, “Our objective always and my objective as CEO of this company is always to take care of our people, our players, and our shareholders. And should there ever be a way for us to do that differently than the way we’re doing it today, I, of course, have to be open to that. But I would tell you today; we feel very, very confident and excited for our future.”