Electronic Arts has jumped into a buyout-in-progress, suddenly outbidding Rockstar Games in order to purchase the development studio Codemasters. Rockstar had offered $970 million to acquire Codemasters, a British company behind racing games such as the DiRT series, Project Cars, GRID, F1, and others. However, before anything could be finalized, EA swooped in with a larger bid of $1.2 billion, an amount that Codemasters agreed to, with the buyout set to occur in Q1 2021.

“We believe there is a deeply compelling opportunity in bringing together Codemasters and Electronic Arts to create amazing and innovative new racing games for fans. Our industry is growing, the racing category is growing, and together we will be positioned to lead in a new era of racing entertainment. We have admired Codemasters’ creative talent and high-quality games for many years. With the full leverage of EA’s technology, platform expertise, and global reach, this combination will allow us to grow our existing franchises and deliver more industry-defining racing experiences to a global fan base. We are pleased that both our Boards of Directors are recommending this transaction, and we look forward to welcoming such an exciting and talented team to the Electronic Arts family,”said Andrew Wilson, CEO of Electronic Arts.

With EA currently also owning the Need for Speed franchise, this move gives them a large control over the racing game genre. The CEO of Codemasters hopes that the buyout will allow them to create "bigger and better games to an extremely passionate audience".

Source

 

[eriol33]

Rip codemasters

 

[raxadian]

So, do we get to start a betting pool at how long it takes EA to absolutely destroy Codemasters?

Basically, they are gonna monetize EVERYTHING.

 

[subcon959]

I don't remember Rockstar being interested in Codemasters?

Wasn't it Take 2?

 

[Taleweaver]

... I am I really one of the few who genuinely doesn't care?

Codemasters only made realistic racing games (overlord has been YEARS ago). I guess that's fine for those who care, but I don't care one bit about them. The genre hasn't changed in decades, so it's not like EA is paying for creative geniuses. The amount surprises me (no idea it was that valuable to create shiny vehicles), but EA can have 'em for all I care.

 

[Deleted User]

Besides Videogames, Codemasters was also know for the Game Genie Cheat Code device.
They famously won the lawsuit against Nintendo, who sued them over claim for copyright infringement.
https://en.wikipedia.org/wiki/Lewis_Galoob_Toys,_Inc._v._Nintendo_of_America,_Inc.

 

[[Truth]]

@Chary Its actually TakeTwo, not Rockstar who wanted to buy Codemasters.
TakeTwo is the publisher, Rockstar only a developer.

 

[Ampersound]

I don't think there's anyone being excited about these news. Except for EA themselves of course.

 

[GoldenBullet]

Well, they probably acquired the studio to get more development teams than just having Criterion make all of the driving/flying aspects of a game (apart from the IPs). EA abandoned Battlefield 5 and Battlefront 2 so they can focus on Battlefield 6 (Even though Battlefront 2 was on the verge of bouncing back in popularity). Both of these games have modes that were developed by Criterion (For Battlefield, Firestorm Battle Royale, and Battlefront, Star Fighter Assault).

It is probably cheaper to get a studio of well experienced developers than hiring new developers and having to train them over years. Honestly, on the bright side, you can expect better driving mechanics in more of EA's games now.

 

[Darthagnon]

Is it because these companies are on the stock market that they get "bought" by the Big Stinkers? Why can't the CEOs just say "no"?

ARM bought by Nvidia, Boston Dynamics bought by Hyundai, anything ever bought by Facebook, Minecraft/Github bought by Microsoft...

Monopolies suck. Wish companies could stay small, manageable and competitive.

 

[nani17]

Well this is another company that will die a slow death by EA

 

[FAST6191]

Is it because these companies are on the stock market that they get "bought" by the Big Stinkers? Why can't the CEOs just say "no"?

ARM bought by Nvidia, Boston Dynamics bought by Hyundai, anything ever bought by Facebook, Minecraft/Github bought by Microsoft...

Monopolies suck. Wish companies could stay small, manageable and competitive.

I am not sure such things fall under the banner of monopoly.

As far as CEOs saying no then... varies.

CEO is just a figurehead responsible for the day to day operations of a business. They will tend to be able to hired and fired by the board of directors and shareholders. If the CEO happens to have a controlling interest in the company (Facebook quite famously has this, even if it took inventing a special class of shares to do it) then there might be little they can do to influence things other than saying "if you do this then I am gone when my contract finishes". The model most tech companies use also means they will have some shareholders, likely with voting rights, in exchange for the money from early investment (and a few rounds thereafter).

Being public means there are a greater range of shareholders (some companies get forced to go public once they have enough of them from various private sales of shares) but not much else. It can make it easier to get a controlling stake and thus shareholder votes.

Small and manageable and competitive are not necessarily all related either. Indeed being bought out by a big company (aside from being the end goal for many startups*) can make things more competitive and more manageable if they don't have to pay their own legal team, marketing team, recruitment team, can leech off servers, have access to all the patents (or at least a big enough chest that it scares off other companies from trying it on).

*obviously they hope they become the next bank (aka company that buys all the other companies a la google, microsoft and such) but having a few million from the sale of a company and thus being able to retire before you hit 30 is not the worst thing in the world (even if it might be for some -- see all those dead from drugs and suicide, just like winning the lottery).

 

[Darthagnon]

Thank you for your thorough explanation!