Yup - you first buy out the majority shareholder(s) and then make a public offer for the share buyout.
Btw, 42% of Square Enix is foreign companies and individuals. Talk about Japan investments.
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Xbox is the business with the second best growth rate within MS, I bet that another acquisition is incoming, it makes only sense. We also must keep in mind that when GP reach a very big threshold (like 50M), the dividends will literally explode. Also with a large publisher acquisition you have the secondary effect to corner and dry-out the competitors line-up, which means, indirectly, more subs for you and less market share for the others.
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Theoretically, what is the largest aquisition xbox could do and have it pass legally? I guess to rephrase this, what companies legally will they not allow them to aquire?
I think acquiring Valve would raise a LOT of anti-trust/monopoly concerns.
That said, I think other publisher acquisitions would still be considered legal, but I can see a lot of backlash from core gamers if certain ones were acquired.
Why? On pc there are many other stores free of MS control: Epic, GOG, Origin, Ubisoft, Itch, Humble, Rockstar, Oculus, Vive, etc…
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I can’t think of a single gaming acquisition that woukd get rejected for anti-trust. They could probably buy Sony or Nintendo (not and) if they wanted to lol.
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I disagree. Windows is still an open platform with a multitude of competing stores.
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They cannot buy Sony without Japan government consensus, Sony is a critical company for Japan security because of technology and communications involvement. Nintendo yeah, theoretically they can, it’s “only” a game company, no national security concerns.
EA or Activision but not Valve or Sony. Nintendo may be possible, but difficult.
Why not Valve? I mean, being private owned is way easier than EA or Activision (also cheaper, these companies are bigger than Valve).
You can attempt to acquire. It is probably even doable. But regulators will have to review that you have not cornered the market immediately. This applies to private parties as well.
Valve and Sony come with automatic one year reviews by regulators like Nokia did.
The true test is Nvidia acquiring ARM. If that happens then there are a lot of possibilities. (Google, MS, Qualcomm are opposing it.)
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Well, NVIDIA acquiring the ARM license would be immensely more drastic than a MS-Valve acquisition, by far. As I already said, there are many storefronts on pc, no regulator can argue that.
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Yeah - but understand this, the burden of proof is on the acquiring entity. And opposition can be raised always by any party out there. In this case, expect Epic to raise concerns with the regulator. Salesforce raised objections on Linkedin.
Not a single acquisition except maybe Valve would raise any kind of legal concerns.
Acquiring Sony or Nintendo would.
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There are other platform holders in the market and these ones are unrealistic at this point so idk why people bring these up.
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@javycane Sony is national security blocked by Japan, as I already said. Nintendo is a game company, so it is theoretically feasible, it doesn’t even really compete with MS or Sony anymore, the Switch is a tablet/companion device by all definitions.
Obviously MS would do the necessary steps. Tim Sweeney can whine all he wants, his consistency is not really great, he continues to lose vs Apple with better arguments than this (possible) one, because Apple does really harm competition. Ironically his own store would make an argument against regulator concerns. XD
They (Sony and Nintendo) are not brought up as realistic acquisition targets, they are brought up as the type of acquisition that would be realistically considered monopolistic.
I don’t view Valve as a realistic acquisition target, primarily because they have no reason to sell and i hate waxing philosophic about hypotheticals, but they are not the type of purchase that would be stopped. There may be concessions that have to be made to ensure continued competition, similar to when Charter bought Time Warner Cable or when a company like Verizon buys a regional carrier and has to sell off a set of spectrum to appease regulators, but the acquisition would be highly likely to be completed. Hell, the US Government didn’t stop the third largest US cellular company from buying the fourth largest.
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Speaking about realistic targets, Matt Booty has been the man of XGS acquisitions since his appointment as the head of first party (he announced Obsidian and inXile at X018 and Double Fine at E3 2019), maybe we can expect another one from his “pc focused piece” expect tomorrow (or friday? I don’t remember)?
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Quite right.
If you are an M&A lawyer or consulting entity - you can always request the target entity to restructure such that a different legal clause is applicable. That is always an option. Like Sony splitting into multiple entities to ensure that national security clauses are compartmentalised to only one of the derived split entities – which would be different from the one that would be an acquisition target.
Hypotheticals are amazing. I can understand why M&A lawyers like Hoeg are enthusiastic about such events in the gaming industry.
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