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SEGA et SAMMY : ça va saigner!!
February 13, 2003 - Old-school publisher and developer of many of the world's most loved games, Sega Corp., announced today it has plans to merge with up-and-coming publisher Sammy Corp., the long-time pachinko maker, coin-op manufacturer and software publisher.
A Bloomberg news report indicated that Sammy President Hajime Satomi will head the merged company, but added he isn't sure who will ultimately control it, and that the two companies will unite on Oct. 1, 2003. No Sega of America representatives were able to return our calls prior to deadline.
While circulated rumors of Sega's potential merger has surfaced repeatedly in the past, few would have guessed that the smaller, less prevalent and yet very solvent Sammy Corp would be the one to merge with Sega. Sammy's current market value is 132 billion yen ($1.1 billion). It reports almost no debt. Sega's market capitalization is 20% higher, with interest, but it bears a debt of 83.6 billion yen.
"By combining Sammy's high growth power in pachinko game systems and Sega's strength in software development and in the arcade business, we can create a globally known, comprehensive entertainment firm," Sammy President Hajime Satomi, who will lead the new entity, told a news conference.
The new company is likely to retain the name brand and library of Sega's beloved of characters and games, even while Sammy absorbs Sega's loss, Satori said.
"Sega's brand name is recognized worldwide, and it would be a shame to discard it," he added.
The newly united company may absorb all of Sega's game-making subsidiaries, the reports said. Satomi added that it will form as either a merger or through the creation of a holding company that will integrate the companies' operations. Sega and Sammy plan to form an integration committee to decide the company's new name, Sega President Hideki Sato's role, and where the company will be headquartered. "We want Sega President Hideki Sato to remain one of the core management members after the integration," Satori added.
Financially, the two companies are on very different footings. Sega's long-term debt includes two issues of convertible bonds worth 56.8 billion yen. Moody's Investors Service gave it a B3 rating, six levels below investment grade. Meanwhile, Sammy has long-term loans of 3.3 billion yen (by end of March last year), with no debt. In the financial year ending March 31 2002, Sammy more than doubled its profit and sales, posting a group net income of 23.9 billion yen on sales of 164.3 billion yen.
Sega made strong earnings in arcade sales in its fiscal first half ended Sept. 30. And Sega had high hopes for its sports games NFL 2K3 and NBA 2K3, but posted weaker-than-expected sales in the face of enormous branding and marketing efforts from Electronic Arts.
"Sega is suffering from losses in consumer game software and overseas operations, but the overseas business has been in large part restructured and videogame operations should be able to generate a profit with Sega's high technological skills," he said.
We'll have more on Sega's future soon.
Je suis dingue de Sega, j'adore Sammy et leurs dernières moutures. Je sais que ça fait pas partie des news néo, mais ne tiendrai t-on pas là le tueur de Playmore-Eolith-...?
A Bloomberg news report indicated that Sammy President Hajime Satomi will head the merged company, but added he isn't sure who will ultimately control it, and that the two companies will unite on Oct. 1, 2003. No Sega of America representatives were able to return our calls prior to deadline.
While circulated rumors of Sega's potential merger has surfaced repeatedly in the past, few would have guessed that the smaller, less prevalent and yet very solvent Sammy Corp would be the one to merge with Sega. Sammy's current market value is 132 billion yen ($1.1 billion). It reports almost no debt. Sega's market capitalization is 20% higher, with interest, but it bears a debt of 83.6 billion yen.
"By combining Sammy's high growth power in pachinko game systems and Sega's strength in software development and in the arcade business, we can create a globally known, comprehensive entertainment firm," Sammy President Hajime Satomi, who will lead the new entity, told a news conference.
The new company is likely to retain the name brand and library of Sega's beloved of characters and games, even while Sammy absorbs Sega's loss, Satori said.
"Sega's brand name is recognized worldwide, and it would be a shame to discard it," he added.
The newly united company may absorb all of Sega's game-making subsidiaries, the reports said. Satomi added that it will form as either a merger or through the creation of a holding company that will integrate the companies' operations. Sega and Sammy plan to form an integration committee to decide the company's new name, Sega President Hideki Sato's role, and where the company will be headquartered. "We want Sega President Hideki Sato to remain one of the core management members after the integration," Satori added.
Financially, the two companies are on very different footings. Sega's long-term debt includes two issues of convertible bonds worth 56.8 billion yen. Moody's Investors Service gave it a B3 rating, six levels below investment grade. Meanwhile, Sammy has long-term loans of 3.3 billion yen (by end of March last year), with no debt. In the financial year ending March 31 2002, Sammy more than doubled its profit and sales, posting a group net income of 23.9 billion yen on sales of 164.3 billion yen.
Sega made strong earnings in arcade sales in its fiscal first half ended Sept. 30. And Sega had high hopes for its sports games NFL 2K3 and NBA 2K3, but posted weaker-than-expected sales in the face of enormous branding and marketing efforts from Electronic Arts.
"Sega is suffering from losses in consumer game software and overseas operations, but the overseas business has been in large part restructured and videogame operations should be able to generate a profit with Sega's high technological skills," he said.
We'll have more on Sega's future soon.
Je suis dingue de Sega, j'adore Sammy et leurs dernières moutures. Je sais que ça fait pas partie des news néo, mais ne tiendrai t-on pas là le tueur de Playmore-Eolith-...?
! Au passage, mon texte est + long que le tiens
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