Electronic Arts was ready to part with as much as $1 billion to acquire Valve Software, according to a new report.
A report by the new york times wrote that: “Valve has been pursued over the years by Electronic Arts, which would very likely have valued Valve at well over $1 billion had the talks progressed that far”.
The article claimed the information had come from “two people with knowledge of the discussion who spoke on condition of anonymity because the talks were private”.
However, Valve company president Gabe Newell said the company would “disintegrate” if it was purchased by another company.
“It’s way more likely we would head in that direction than say, ‘Let’s find some giant company that wants to cash us out and wait two or three years to have our employment agreements terminate,’ ” he said.
In the past five years Electronic Arts has spent more than $1 billion on acquisitions. The company has bought the likes of PlayFish, Firemint and even popcap creatures of such as plants vs zombies and peggle.
Wedbush Securities analyst Michael Pachter estimates that Valve should be valued at around $2.5 billion, more then twice what EA would be prepared to spend on the company famed for its steam distribution service as well as the left for dead, counter strike and half life series.
The Washington based games studio is believed to make far more money from its Steam digital distribution service than sales of its own games.
Peter Moore, the second-in-command at EA, told the New York Times that Valve is “on the cutting edge of the future of this industry”.