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EA to buy 20% of Ubisoft - report

Consolidation comes to games publishing biz

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Electronic Arts is to buy a big chunk of Ubisoft, paying $85-100m for a 20 per cent stake in the French games publisher.

So says today's Wall Street Journal, though neither company has yet to comment formally on the claim.

Earlier this year, EA CEO Larry Probst forecast the games industry would see further consolidation over the next three to five years, though at the time - May 2004 - he was quick to point out that EA wasn't going to be a big buyer of companies.

If the deal with Ubisoft goes ahead, it would appear that Probst has changed his mind. In August 2004, UK publisher Eidos confirmed that it is in talks with one or more other publishers about a possible merger or acquisition of Eidos' business.

Curiously, Ubisoft was one of the names most frequently bandied about when Eidos' plan was made public, though the publisher itself has sternly refused to name names. Ubisoft's president, Yves Guillemot, has expressed an interest in acquiring Eidos, but that was a couple of years ago.

Consolidation of the games publishing business will surely attract the closer attention of the world's trade regulators - indeed, any deal between EA and Ubisoft will need to win US government approval before it can go ahead. However, with regulators on both sides of the Atlantic approving the merger of Sony and BMG earlier this year, taking the number of major recording companies from five to four, games publishers no doubt feel they have some way to go before regulators will begin to worry that too much market power is being placed in too few hands. ®

Related stories

Eidos does due diligence on would-be buyers
Graphics patent holder sues Sony, MS, Nintendo
Game makers hit with graphics patent violation suit
Harry Potter games outfit loses its magic
Eidos plunges into red
Eidos confirms takeover talks
EA swallows Criterion Software
Eidos issues profit warning
Eidos snaps up IO Interactive

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