NEW YORK (The Hollywood Reporter) — U.K. videogame maker Eidos Plc. said March 22 that it has agreed to a $136.3 million all-cash acquisition by Silicon Valley private equity firm Elevation Partners, whose partners include U2 singer Bono and former executives of Electronic Arts and Apple Computer.
However, in a sign that a takeover battle could be looming, Eidos later in the day acknowledged that it also has received an all-share offer from fellow U.K. game firm SCi Entertainment Group Plc.
In a statement, SCi said that based on its March 21 closing price, its bid is valued at £76.1 million ($143.5 million). That amounted to a 19.8% premium over Eidos’ closing price that day.
Elevation’s offer is valued at £71 million ($134.8 million), which would amount to a 11.7% premium.
While Elevation’s offer has the backing of Eidos’ board, SCi said investors holding nearly 20% of Eidos have promised to accept its proposal.
Menlo Park-based Elevation was founded last year with the goal of focusing on large-scale opportunities in media, entertainment and consumer businesses. Eidos would mark its first major investment.
Besides Bono, Elevation’s leadership also includes former EA president/CEO John Riccitiello, former Apple CFO Fred Anderson, former Blackstone Group senior managing director Bret Pearlman, as well as Marc Bodnick and Roger McNamee, former executives of private equity outfit Silver Lake Partners.
Elevation said March 22 that it plans to take Eidos private at least for a few years to focus on executing game-creation and release schedules better. That also means that Elevation could take Eidos public again down the line.
“Businesses that partner with Elevation expect to transform themselves through the strategic use of technology and licensing, as well as improvements in core marketing, distribution and operating processes,” the private equity firm said on its Web site.
In a statement March 22, SCi CEO Jane Cavanagh argued that her firm’s recent track record of financial performance and discipline would allow it to boost the performance of Eidos’ business, thereby making that combination the most attractive alternative.
American depositary shares of Eidos on March 22 closed up 22.4% at $1.04.