Leader in Interactive Entertainment &
UK-Based Game Developer & Publisher Set to Thrill Racing
Fans
Today, Electronic Arts Inc. (NASDAQ: EA) announced that it has
reached an agreement with the Board of Codemasters for the
recommended acquisition of Codemasters, the UK-based game developer
and publisher. In the transaction, Codemasters' shareholders will
be entitled to receive 604 pence (approximately US$7.98*) in cash
for each ordinary share of Codemasters with an implied enterprise
value of US$1.2 billion*. The acquisition is anticipated to be
completed in the first quarter of calendar 2021.
“Electronic Arts and Codemasters have a shared ambition to lead
the video game racing category. The Board of Codemasters firmly
believes the company would benefit from EA’s knowledge, resources
and extensive global scale – both overall and specifically within
the racing sector. We feel this union would provide an exciting and
prosperous future for Codemasters, allowing our teams to create,
launch and service bigger and better games to an extremely
passionate audience,” said Gerhard Florin, the Chairman of
Codemasters.
“We believe there is a deeply compelling opportunity in bringing
together Codemasters and Electronic Arts to create amazing and
innovative new racing games for fans. Our industry is growing, the
racing category is growing, and together we will be positioned to
lead in a new era of racing entertainment. We have admired
Codemasters’ creative talent and high-quality games for many years.
With the full leverage of EA’s technology, platform expertise, and
global reach, this combination will allow us to grow our existing
franchises and deliver more industry-defining racing experiences to
a global fan base. We are pleased that both our Boards of Directors
are recommending this transaction, and we look forward to welcoming
such an exciting and talented team to the Electronic Arts family,”
said Andrew Wilson, CEO of Electronic Arts.
Strategic Rationale:
- Electronic Arts believes the combination of EA and Codemasters
will enable further growth and success for Codemasters and EA’s
popular and innovative racing franchises.
- Bringing together the combined expertise and talent from
Codemasters’ critically-acclaimed sports and racing franchises
Formula One, DiRT, DiRT Rally, Grid and Project Cars with EA’s
global Need for Speed franchise, fan-favorite Real Racing mobile
game and EA SPORTS brands will enable our teams to innovate
further, and meaningfully increase the delivery of content and
experiences to a growing, global audience for racing
entertainment.
- Codemasters’ deep creative talent which has produced
high-quality racing games for many years, including the Formula One
franchise that continues to deliver great entertainment for F1’s
growing fan base.
- EA believes it can help accelerate Codemasters’ performance by
leveraging EA’s deep expertise in live services operations, game
analytics and technology. In addition, EA’s central services teams
across development technology, art & motion capture, quality
verification, compliance, and localization will all be resources
available to Codemasters.
- EA’s global publishing, marketing and game development support
capabilities will also strengthen Codemasters’ existing
capabilities, expanding the addressable market for Codemasters’
franchises.
- The combination of Codemasters and Electronic Arts will enable
the development and delivery of a market-leading portfolio of
creative and exciting racing games and content to more platforms
and more players around the world.
- The union also creates ongoing and expanded ways for players to
engage with the combined portfolio of sports and racing games
through EA’s industry-leading multi-platform subscription
services.
- Bringing together Codemasters and Electronic Arts also delivers
compelling financial benefit to the combined group. The acquisition
is expected to grow net bookings and underlying profitability.
- Frank Sagnier, Chief Executive Officer of Codemasters, and
Rashid Varachia, Chief Financial Officer of Codemasters, along with
the senior executive management team of Codemasters intend to
remain with Codemasters following completion of the acquisition and
will continue to lead the Codemasters business within EA’s
organization.
For more information on the acquisition, please visit:
investor.ea.com.
*US$ equivalent values are stated at an exchange rate of US$
1.3211:£1 on December 11, 2020. Enterprise value based on
Codemasters’ audited balance sheet as of March 31, 2020.
UBS Investment Bank is acting as financial adviser to Electronic
Arts and Skadden, Arps, Slate, Meagher & Flom (UK) LLP is
acting as legal adviser to EA.
Jefferies International Limited is acting as financial adviser
and joint-broker, and Liberum Capital Limited is acting as
nominated adviser and joint-broker to Codemasters in respect of the
acquisition. Gowling WLG (UK) LLP is acting as legal adviser to
Codemasters.
All trademarks and copyrights contained herein are the property
of their respective holders.
Forward-Looking
Statements
The statements contained herein which are not historical facts
are considered forward-looking statements that are subject to
change. Statements including words such as “anticipate,” “believe,”
“expect,” “intend,” “estimate,” “plan,” “predict,” “seek,” “goal,”
“will,” “may,” “likely,” “should,” “could” (and the negative of any
of these terms), “future” and similar expressions also identify
forward-looking statements. These forward-looking statements are
not guarantees of future performance and reflect management’s
current expectations. Our actual results could differ materially
from those discussed in the forward-looking statements. Some of the
factors which could cause the Company’s results to differ
materially from its expectations include the following: the impact
of the acquisition’s announcement on the Company’s business and
operating results; the occurrence of any circumstance or any other
events that could give rise to the termination of the acquisition,
or the failure to meet conditions to complete the acquisition,
including the receipt of all necessary regulatory approvals; the
Company’s ability to successfully integrate Codemasters’ operations
and employees; the impact of the COVID-19 pandemic, sales of the
Company’s products and services; the Company’s ability to develop
and support digital products and services, including managing
online security and privacy; outages of our products, services and
technological infrastructure; the Company’s ability to manage
expenses; the competition in the interactive entertainment
industry; governmental regulations; the effectiveness of the
Company’s sales and marketing programs; timely development and
release of the Company’s products and services; the Company’s
ability to realize the anticipated benefits of acquisitions; the
consumer demand for, and the availability of an adequate supply of
console hardware units; the Company’s ability to predict consumer
preferences among competing platforms; the Company’s ability to
develop and implement new technology; foreign currency exchange
rate fluctuations; general economic conditions; changes in our tax
rates or tax laws; and other factors described in Part II, Item 1A
of Electronic Arts’ latest Quarterly Report on Form 10-Q under the
heading “Risk Factors”, as well as in other documents we have filed
with the Securities and Exchange Commission, including our Annual
Report on Form 10-K for the fiscal year ended March 31, 2020.
These forward-looking statements are current as of December 13,
2020. Electronic Arts assumes no obligation to revise or update any
forward-looking statement for any reason, except as required by
law.
About Electronic Arts
Electronic Arts (NASDAQ: EA) is a global leader in digital
interactive entertainment. The Company develops and delivers games,
content and online services for Internet-connected consoles, mobile
devices and personal computers. In fiscal year 2020, EA posted GAAP
net revenue of $5.5 billion. Headquartered in Redwood City,
California, EA is recognized for a portfolio of critically
acclaimed, high-quality brands such as EA SPORTS™ FIFA,
Battlefield™, Apex Legends™, The Sims™, Madden NFL, Need for
Speed™, Titanfall™ and Plants vs. Zombies™. More information about
EA is available at www.ea.com/news.
EA SPORTS, Ultimate Team, Battlefield, Apex Legends, The Sims,
Need for Speed, Titanfall and Plants vs. Zombies are trademarks of
Electronic Arts Inc. Madden, NFL and FIFA are properties of its
respective owners and used with permission.
Important notices relating to financial advisers
UBS AG London Branch is authorised and regulated by the
Financial Market Supervisory Authority in Switzerland. It is
authorised by the PRA and subject to regulation by the FCA and
limited regulation by the PRA in the United Kingdom. UBS AG London
Branch is acting as financial adviser to EA and no one else in
connection with the acquisition. In connection with such matters,
UBS AG London Branch, its affiliates and their respective
directors, officers, employees and agents will not regard any other
person as their client, nor will they be responsible to any other
person for providing the protections afforded to their clients or
for providing advice in relation to the acquisition, the contents
of this announcement or any other matter referred to herein.
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version on businesswire.com: https://www.businesswire.com/news/home/20201213005036/en/
Cat Channon Sr. Dir, Corporate Communications +41 754422274
cchannon@ea.com
John Reseburg VP, Global Communications 650-628-3601
jreseburg@ea.com
Chris Evenden VP, Investor Relations 408-627-0608
cevenden@ea.com
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