[NX] [EA] Electronic Arts Stock Price Surges. Why?
Electronic Arts (NASDAQ: EA)’s share price soared today by 6.13%, the most the stock has risen in the last four months. Average price ended the April 26 NASDAQ trading day at US$15.93. But why? Because reports are emerging that Tokyo-based free-to-play publisher Nexon Co. Ltd. are in talks to purchase the company. In the mean time, Nexon’s stock fell (TSO:3659) fell 2.31% to close the April 26 TSO trading day at 1,524JPY per share.
It is said that it was Nexon which contacted EA to try to work something out. Both companies are refusing to comment on the reports and rumours. “Nexon has a policy of never commenting on rumors,” the company said in an e-mailed statement. Jeff Brown, an Electronic Arts spokesman, said in an e-mail that the company doesn’t comment on rumors or speculation.
In the calendar year ended December 31, 2011 Nexon reported revenues of US$1.12 billion while EA is expected to report revenues of US$4.17 billion for the fiscal year ended March 31, 2012. EA has a net worth of US$4 billion while Nexon has a net worth of US$6.8 billion.
Experts are saying that the deal either wasn’t even being considered in the first place or that it won’t work out and I agree with their reasoning. Research different experts’ views on this. We’ll just have to wait for these rumours to be dispelled or confirmed and see how this acquisition discussion ends up.