Buddy, can you spare $500m?

Shareholders certainly did on Tuesday, as stock was quickly sold after a 30 per cent price leap accompanied reports that Midway, EA and venture capital outfit Apax have been kicking the tyres.

EA hasn’t shown interest for months, it turned out. The other two may be more plausible – Midway wants to increase its interests outside the US and Apax will buy anything if there is a profit in it.

But a valuation in excess of $500m, when SCI’s purchase of Eidos six months ago only cost around $100m, means that the suitor would have to be absolutely convinced that this is a smart investment, not an ego trip. And any buyer certainly has to see more than smart cashing in by SCI management just ahead of a new era for the market, driven by next-gen hardware.

According to SCI, the approaches so far “may or may not lead to an offer for the company.”


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