EA shares volatile on the back of unconfirmed rumor of Amazon bid
Somebody set us up the bomb
Electronic Arts stock has been volatile this morning on rumors that Amazon was preparing to put in an offer to buy the company that were quickly deemed questionable.
Initial reports came from Swedish gaming media outlet Good Luck Have Fun (GLHF) and were syndicated in USA Today, causing a quick jump in EA's share price in pre-market trading.
Not long after the spike, CNBC's David Faber said he believed the rumors were untrue. Speaking on CNBC's Market Alert, Faber said he doubted the acquisition was about to happen, based on his own sourcing.
"No, this is not going to happen today from what I'm hearing, unless the people who were previously involved have no idea," Faber said, referring to people involved with CNBC parent company Comcast's past failed discussions to buy EA.
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"I talked to some people who would actually know if something was going on, and nothing is going on," Faber said, adding that the Comcast/EA deal fell through because Comcast wanted to maintain voting control over a spun-off company that would merge NBC Universal and EA.
EA is known for producing a number of video game franchises, including Star Wars Battlefield, a number of different licensed sports titles, The SimCity and Sims series, and more.
After the Comcast deal fell through in May, rumors began circulating that EA was still looking for a buyer, and that it was allegedly speaking to Apple, Amazon, and Disney as potential purchasers.
Rumors that EA was looking for a buyer aren't surprising in light of Microsoft's $68.7 billion purchase of World of Warcraft maker Activision Blizzard, one of the largest buyouts in the history of the tech industry. That's sure to put dollar signs in the eyes of any executive.
This story is developing, and will be updated as details continue to emerge. ®