EA Gains on Nexon Takeover Rumors
The following commentary comes from an independent investor or market observer as part of TheStreet's guest contributor program, which is separate from the company's news coverage.
NEW YORK (
Trefis) -- Video gaming publisher
While both companies have refrained from any official statements on the rumor, here we try to look at why Nexon, might be interested in acquiring Electronic Arts. EA competes with other game developers like
Why Nexon Might Be Interested in EABefore analyzing the interest of Nexon in EA, it's important to understand the nature of businesses of these gaming companies. Though not well known in the U.S., Nexon is a pioneer of free-to-play MMO games in Asia. Among all of its games, the company is most well known for Maple Story, a very successful free-to-play MMO in Asia. In a highly publicized event last year, Nexon managed to raise $1.2 billion in its IPO on the Japanese stock market. The company is aiming to grow aggressively in the near term and was recently in the news for its statement that it's looking to buy some smartphone and mobile-game developers. On the other hand, EA has also been gradually cementing its business in the social gaming genre. While the company's Sims Social is already a highly popular game, EA acquired social MMO developer KlickNation in December 2011, to strengthen its hold in social gaming. See:
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