News Nikkei: Sega Sammy to Buy Out Atlus Games' Index Corporation
posted on 2013-09-18 00:30 EDT
Japanese financial news source Nikkei reported on Wednesday that Sega's parent company Sega Sammy Holdings has decided to take over and buy out Index Corporation for about 14 billion yen (about US$140 million) in November. Index owns and manages Atlus, a former independent company and the current brand of games such as Etrian Odyssey, Shin Megami Tensei, and Persona.
According to Nikkei, absorbing Index will strengthen Sega Sammy's position in consumer and portable games. Sega Sammy has been reporting falling software sales in consumer and portable games, primarily in Europe and North America, for two straight fiscal years. On the other hand, Atlus has annual operating income reportedly in the range of 1 billion yen (US$10 million) in consumer and portable games. Nikkei adds that Sega Sammy wants to use Index's assets to develop its prospects in smartphone games.
Bloomberg Japan reported last month that about 20 companies, including Sega-Sammy Holdings, were looking to acquire Index. According to Bloomberg's source, the first round of bids were in the range of 20 billion yen (about US$200 Million). The final bidding candidates were expected to be selected and a final deal to be made sometime last month.
Index came under suspicion for improper accounting in June. Index reported that it earned a total of 18.3 billion yen (about US$190 million) last year from console/portable system games and smartphone games. However, according to those involved in the investigation, the company is under suspicion of exaggerating revenues using round-trip transactions.
Later that month, Index filed for civil rehabilitation bankruptcy. Civil rehabilitation is a relatively new form of bankruptcy procedures in Japan, having been passed into law in 1999. Index listed about 24.5 billion yen (about US$250 million) in debts.
Update: Sega issued the following news release on Wednesday: "It was reported by some in the media today that our company would take over Index Corporation. However, this is not what our company has announced." [Via My Game News Flash]
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