In the conference call EA Chairman and Chief Executive Officer Larry Probst was asked why EA decided to buy into mobile content rather than build their own. His reply: “Obviously this is a build or buy decision, we have very carefully examined this space over a couple of months, and we’re impressed with Jamdats job in North America, its a clear market leader in that geography…We could be build it over time but over that period of time Jamdat is not going to stand still and wait for us to catch up… We like to be the market leader and this allows us to do that quickly.” At other points Jamdat’s development and deployment system was talked up. I think the following quote sums up the thinking, or at least the position of the two companies (I didn’t catch who said it):
If there’s a word in our mind that would describe why we did this it is ‘acceleration’…we’ve combined forces that will allow both of our forces to grow that much faster globally.
EA claims the valuation of Jamdat was based on cashflow and it expects a good return even before exploiting the synergies between the two businesses.
From Jamdats side, Chairman and Chief Executive Officer Mitch Lasky said that the business was sold now because “$27 in cash is a great result for our shareholders”. He said there wasn’t anything that made Jamdat think it needed a big partner and said the deal was “playing offence not defence”.
Looking into the future, EA said the deal doesn’t change anything in the company’s acquisition strategy and it will continue to look for strategic acquisitions. There was also some very general talk about Asia, about 3G games in Japan and the importance of expansion into China and India as key drivers…
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) The full audio download of the conference call is here (4.8 MB, 25 mins)
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