Online retail giant Amazon is unlikely to bid to take over video game maker Electronic Giants (EA), which is the maker of popular games including the soccer series FIFA.
The company rejected reports that it would make a bid for the video game publisher, Reuters cited a CNBC report. After news of a speculated takeover spread like wildfire, EA shares jumped 15% in premarket trading. Shares were up 4% in early trading, Reuters reported.
However, Amazon and Electronic Arts said they do not comment on rumors and speculation related to mergers and acquisitions.
Earlier this month, Amazon offered to buy Roomba vacuum cleaner maker iRobot Corp for $1.7 billion. The online retail giant has started down the acquisition route and is looking to diversify its business under new chief executive Andy Jassy.
Amazon owns video game streaming platform Twitch. It also bought MGM Studios, the creator of the hit movies “Rocky” and “James Bond” for $8.5 billion.
Earlier this year Microsoft bought Activision Blizzard, the maker of games like Call of Duty and Candy Crush for a whopping $68.7 billion. The new deals also blur the line between personal computers and mobile game companies and come against the backdrop of a struggling global gaming industry as pandemic-fueled demand declines.
The global games market is expected to grow just 2% in 2022 from a year ago, according to data from research firm Newzoo, a far cry from the 23% growth recorded in 2020.
EA forecast lackluster adjusted sales numbers, saying it was not “completely immune” to the recession.
Its shares were down about 3% at Thursday’s close, compared to a drop of nearly 30% for Take-Two.
EA has yet to release any major new titles this year and is still grappling with the fallout from Battlefield 2042, which debuted last November to lackluster reviews and poor fan reception.
(With contributions from Reuters, Bloomberg)