SAMMY TO ACQUIRE OUTSTANDING SEGA SHARES IN STOCK SWAP
TOKYO - Sammy Corp. will pay $1.4 billion in a share-swapping agreement that will enable it to acquire all outstanding shares of Sega, giving it complete control over the firm as of Oct. 1, 2004, the company announced. Terms of the deal represent a 21% premium to be paid by Sammy above Sega's May 17 stock price, Reuters reported. Sega and Sammy will become wholly owned subsidiaries of a newly formed Japanese holding company to be known as Sega Sammy Holdings Inc. Sammy's Hajime Satomi will be president and CEO of the holding company; Sega's Hisao Oguchi will serve as vice-chairman. The deal is subject to approval by shareholders and relevant regulatory authorities. Sammy says it will improve efficiency by streamlining management, combining operations and reorganizing "domestic and overseas subsidiaries." "We intend to' establish Sammy's arcade video game machine 'Atomiswave' as the leading low-cost and high-quality arcade video game machine by enhancing contents through the utilization of Sega's R&D capabilities and globally expanding the market," said company officials. It also plans to "expand the market by promoting online games through networking arcade machines." Sammy currently owns 22.4% of Sega stock, following a $419 million purchase from CSK Corp. last December. Sammy originally planned to merge with Sega in February 2003, but Sega killed the deal.
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