Warner Bros. Strengthens Partnership with SCi
SCi has announced that it has entered into a strategic partnership with Warner Bros. that will give the company “increased scale in the North American market” and see the US firm take up to £15 million new shares in the publisher.
Warner Bros. will subscribe for up to £15m new shares in the company, while agreeing to distribute SCi titles in the US, Canada and Mexico. Warner Bros. parent Time Warner is already a 10 percent stakeholder in SCi and a deal strengthening the bond between the two companies has been rumored for some time.
SCi said it would raise £60m through a fully underwritten placing and open offer of 171,605,424 new shares at 35 pence per share. Following completion of the fund raising the company will have substantial cash balances in addition to its new committed £25 million debt facility.
The company added that its current trading is in line with expectations and that it is on track to deliver cost savings of £14m from its rationalization program at a cost of £7m, as announced in February.
It also noted that its progress with Tomb Raider: Underworld “remains encouraging” and the game is scheduled for worldwide release before Christmas 2008.
“Today we have significantly strengthened our relationship with Warner Bros., one of the world’s largest media groups, to create an exciting strategic partnership, giving us increased scale in the North American market, to the benefit of all our major franchises,” said SCi CEO Phil Rogers.
“The new financing puts us in a clear position to deliver on the strategic business plan which we announced in February with focus on cornerstone studios and core franchises, delivering high-quality, world class games.”
Warner Bros. Home Entertainment Group president Kevin Tsujihara added, “This investment underscores Warner Bros.’ commitment to becoming a major presence in the videogame business.
“With SCi’s new management team in place along with their track record of rich franchises like Tomb Raider, Hitman and Deus Ex we believe we have formed an exciting partnership and a powerful engine for growth.”
In January 2008 SCi’s CEO, managing director and managing director of studios stepped down, while in February the company announced plans to cut a quarter of its workforce and cancel 14 projects as part of radical restructuring plans.
Earlier this week SCi revealed it had rejected a proposal from another mystery suitor.