Banks tell Eidos to fish or cut bait.

[SirFozzie]

Gee.. looks like they're relying on (what else) sequels to save em, but they don't have enough to release them right now. Interesting to see "CM"5 is still delayed, any later and they'll need to update all the info.

Time running out for Eidos to save itself

Games company may be forced to sell Lara Croft

Richard Wray and Neil Hume
Friday March 11, 2005
The Guardian

Eidos, the British computer games company that created Tomb Raider's Lara Croft, has two weeks to clinch a takeover deal or it will be at the mercy of its bankers.

The former gaming flagship has seen delays to key games, such as Championship Manager, eat through its cash while takeover talks with a number of potential bidders have dragged on for more than seven months.

As Eidos announced a wider than expected half year loss yesterday, the company's bankers appeared to say that enough is enough. Shares in the company sank to a 10-year low.

The Royal Bank of Scotland, which has loaned Eidos £23m, has given the company until March 25 to clinch a deal or get funding from elsewhere otherwise it will demand that Eidos starts selling off parts of its business.

A similar fire sale was carried out last year by heavily indebted French computer games company Infogrames Entertainment, which ironically made an approach to buy Eidos four years ago. Eidos walked away from those talks after the two sides were unable to agree on a price.

The French company sold off its successful Civilisation gam ing franchise and industry analysts believe Eidos may have to sacrifice Lara Croft or possibly its Hitman series of games to keep its bankers happy.

But Eidos insiders appeared confident last night that an offer for the business can be clinched before the bank's deadline.

Eidos said yesterday that it has received an approach at a mere 53p a share, valuing the once high-flying company at £75m. But the bidder, believed to be a venture capital firm, still has to get its own house in order before it can make a formal offer.

Eidos said the deal on the table is subject to "one principal condition", which was unspecified, but is understood to have nothing to do with the buyer raising the cash for any acquisition or be related to any action Eidos itself must take.

Some in the market believe there are a number of other potential buyers waiting in the wings for Eidos, which said it had first been approached in August last year

Eidos is believed to have received interest from venture fund Elevation Partners which counts U2's lead singer Bono among its managing partners and was founded by John Riccitiello, the former president of video game maker Electronic Arts.

A number of trade buyers have also been mooted as interested in Eidos including Ubisoft, Europe's third-largest games developer, and Rupert Murdoch's News Corp.

Industry analysts, however, believe it would be easier for any potential trade buyer just to wait for Eidos to collapse and pick up the pieces rather than buy the business outright.

Eidos was yesterday forced to admit that while the long-running takeover saga has rumbled on its business has deteriorated. It announced a larger than expected pretax loss of £28.7m for the six months to end December compared with a profit of £7.8m in the previous year. Sales of £31.4m were well down on the £78.7m recorded in the previous year. Sales of titles such as Get On Da Mic, Backyard Wrestling 2 and Crash 'n' Burn were also below expectations.

Poor sales and delayed releases mean the company's cash has dropped from £37.4m at the end of June last year to £11.8m six months later. To conserve its money the company has been forced to delay the release of new Lara Croft and Hitman titles until later in the year.

"As these results show, the first half has been a very difficult period for Eidos," admitted chairman John van Kuffeler.

[SlapBone]

Lara Croft built that house, and it will be she that tears it down.

[HomerJSimpson]

Couldn't happen to a nicer bunch of idiots.

[Crapshoot]

Jee, looks like Marc V and Miles knew this was coming....

[HomerJSimpson]

Originally Posted by Crapshoot

Jee, looks like Marc V and Miles knew this was coming....

I would say more that Marc and Miles and company leaving helped expediate this coming. If Edios kept FM, they would have had a game released already, and they wouldn't be taking such massive losses.

[KevinNU7]

Dang, don't bold everything like that

[andy m]

it'd be a crying shame if chumpionship mongager 5 didn't make it out.

[Yossarian]

I read on one of the industry types that the reason they haven't been able to find a buyer is that they are a publishing company and want to sell at a price befitting of a publishing company.

But the big publishing companies (who you would assume are keen) dont want the publishing part of EIDOS, they just really want the IP, the games etc..

So they've been recieving bids / offers at a game developer / IP level whereas they want offers at a publishing level

[HomerJSimpson]

Marc, has SI/Sega asked about buying the Champ-man name back?

[Cringer]

Damn, I thought the thread title meant they were being forced to make a Pro Bass Tour sim.....

[Marc Vaughan]

Originally Posted by HomerJSimpson

Marc, has SI/Sega asked about buying the Champ-man name back?

Nah - we've got a pretty good brand name setup now in FM, don't really see the point in spending million of pounds on something intangiable ... at the end of the day investing in the games more useful, both to us and players of our games ..

[HomerJSimpson]

Originally Posted by Marc Vaughan

Nah - we've got a pretty good brand name setup now in FM, don't really see the point in spending million of pounds on something intangiable ... at the end of the day investing in the games more useful, both to us and players of our games ..

I agree. Just curiuos.

[Eaglesfan27]

Originally Posted by Marc Vaughan

Nah - we've got a pretty good brand name setup now in FM, don't really see the point in spending million of pounds on something intangiable ... at the end of the day investing in the games more useful, both to us and players of our games ..

Glad to hear it. Keep spending the resources on pushing the game even further

[Sharpieman]

This is a little off-topic, but it seems that at least I never know how good or bad gaming companies are doing. I know its a private industry and we're not supposed to know. But it would be nice to hear from companies I like, like SI, how they are doing. No need for figures, just estimate like OK or great.

[Marc Vaughan]

Originally Posted by Sharpieman

This is a little off-topic, but it seems that at least I never know how good or bad gaming companies are doing. I know its a private industry and we're not supposed to know. But it would be nice to hear from companies I like, like SI, how they are doing. No need for figures, just estimate like OK or great.

SI are doing ok - not rolling in dough, but not in dire straights .... (same as usual really, we invest pretty much everything back into our games) ....

[Alf]

doh, Marc, you mean that my teen years favorite band, "Dire Straits", should really be called "Dire Straights" ?