$1.45 billion deal will see the Sonic publisher become a subsidiary of a new Sammy-controlled company.
In a joint statement today, Sega and Sammy announced they will be "merging operations" in October by becoming subsidiaries of a new holding company, Sega Sammy Holdings. Once merged, Sega and Sammy's combined annual income for the fiscal year of 2005 are expected to be at 501 billion yen ($4.4 billion), making it one of the biggest game companies in Japan.
However, according to Bloomberg News, the announcement is actually a takeover of Sega by Sammy. Under the terms of the deal, Sammy, which already owns nearly 25 percent pf Sega, will exchange about 165 billion yen ($1.45 billion) of stock in the new company for Sega's remaining shares. Each share of Sammy will be swapped for one share of Sega Sammy Holdings, while each share of Sega will be swapped for 0.28 of a share. The deal will give current Sammy shareholders control of nearly three-quarters of the new company's voting stock.
News source: GameSpot