Infogrames, Atari Merge in $11 mln Deal
Lyon, France-based Infogrames and Atari have agreed to merge, as Infogrames makes an effort to gain a stronger foothold in the US.
Infogrames said Wednesday it would acquire the remaining outstanding equity interests of Atari for $1.68 per share, or $11 million. The merger will make Atari a wholly-owned subsidiary of Infogrames.
Currently, Infogrames is the majority shareholder in Atari, with a 51.4 percent stake in the company.
The deal is slated to close in the third calendar quarter of this year.
"This agreement is an essential and positive development for Infogrames and its shareholders. It brings Atari fully under the control of Infogrames, delivering a platform for future growth in the US," read a statement from the companies.
The move to merge is in line with a recent, major restructuring initiative at Atari. The companies plan to make Atari an online gaming-centric label.
Infogrames CEO David Gardner said, ""Bringing Atari US and Infogrames businesses together will enable us to create a simplified global structure for our business as we seek to re-build a well-managed, cohesive and financially disciplined company. This is a key strategic event for Infogrames that will benefit all of our shareholders. I believe that this transaction will generate significant benefits for the Group."
Infogrames will be lending Atari $20 million as part of the transaction, "subject to the terms and conditions of the credit agreement between Atari and Infogrames."
The loan will be used to fund Atari’s operational cash requirements between now and the closing of the merger deal.