Square Enix Makes Bid for Eidos

Square Enix has made a play to acquire all shares of UK-based Eidos for a  relatively low $120.2 million, Square said today in a statement.

Under terms of the deal, Eidos shareholders will receive 45 cents per share. The offer represents a 258 percent premium based on Eidos’ 9 pence (12 cents) close on the London Stock Exchange on January 14, the day before Eidos announced it received an offer.

“Square Enix believes that the acquisition of Eidos represents a highly attractive opportunity for the Square Enix Group to create further value for [Square’s]  shareholders,” Square said.

The deal would give Square access to Western-friendly franchises such as Tomb Raider, Hitman, Deus Ex and Thief. While it’s safe to say Square already has hits in the likes of Final Fantasy and Kingdom Hearts, almost of its popular titles in the West have been role-playing games, which have a loyal but niche audience.

"The total cost is relatively small, essentially the cost of buying a middle of the road developer, so I would say it's a good deal for Square Enix. My view is that they are buying the company for the existing franchises, so I wouldn't expect to see any of them killed off,” Wedbush Morgan analyst Michael Pachter told UK magazine Edge.

Square expects Eidos shareholders to vote in favor of the buyout next month, and sees it being a done deal by the end of April.

(Conversion: 1 dollar=70 pence)