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Wednesday April 21 1:36 PM ET
Electronics Boutique Sees Boost From Game Merger
WEST CHESTER, Pa. (Reuters) - Electronics Boutique Holdings Corp. (Nasdaq:ELBO - news), a U.S.-based specialty retailer of electronic games, said Wednesday it expected its 1999 earnings to increase after the acquisition of Game Plc by Electronics Boutique Plc, with which the Pennsylvania company has a management contract.
Earlier this month, London-based Electronics Boutique Plc said it planned to buy Game Plc., for about $160 million, at current exchange rates.
''The acquisition could increase management fees by 3 to 4 cents per share for the full year 1999,'' said Electronics Boutique Holdings Chief Financial Officer John Panichello in a telephone interview. ''That goes right to our bottom line once the deal closes.''
As part of its management contract with Electronics Boutique Plc, Electronics Boutique Holdings will receive a minimum of 1 percent of net sales of the combined company, which totaled about $390.1 million in 1998 on a pro forma basis.
Panichello said he expected the deal to close by early May.
The acquisition of Game Plc, a rival British retailer, is subject to shareholder approval and customary closing conditions, the company said in a statement.
After the transaction is completed, Electronics Boutique Plc will operate 268 stores throughout Britain, with an estimated 20 percent share of the market.
Electronics Boutique Holdings, based in West Chester, Pa., is a leading specialty retailer of video and computer games and also sells video game hardware, PC software and accessories.
The company currently operates 547 stores in 45 states, Puerto Rico, Canada, Australia and South Korea. It has also established a separate electronic commerce division, EBWorld.com Inc. |
