MicroProse [MPRS] has no plans to seek another suitor following Friday's collapse of its merger deal with GT Interactive [GTIS], MicroProse CEO Stephen Race tells MMWIRE.
Acquirers may take a closer look at whether a potential acquisition will drag their earnings, particularly when the deal would be large. GT and MicroProse put the kibosh on their planned merger, with GT saying, on closer inspection, MicroProse would have diluted its earnings. Valued at $250m when announced in October, the MicroProse deal would have eclipsed GT's past acquisitions, including Humongous Entertainment.
MicroProse lost some momentum as a result of the canceled deal, since GT had asked MicroProse to push Worms2 and Ultimate Race Pro from release in the December quarter to the March quarter, Race says. MicroProse revealed yesterday it anticipates posting a $7m-$10m net loss on $17m-$20m in revenues for Q3, which ends Dec. 28.
Although some insiders yesterday speculated MicroProse might sell to another publisher, particularly Activision [ATVI], Race denies MicroProse is still up for sale. "We're making plans to operate as an independent company," he says.
MicroProse's stock plummeted more than 50% yesterday, falling 2-3/8 to close at 2-5/16. GT's stock was much less volatile, losing less than 4% of its value, dropping 5/16 to 8-13/16. (MicroProse, Stephen Race, 510/522-3584)
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mmwire.com
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