EA stock rises on Nexon acquisition rumors

Could Nexon acquire one of the biggest Western game publishers? That was the rumor today that managed to send the share price of Electronic Arts up in trading today. Bloomberg reports that EA's stock price rose six percent today.

This move was thanks to a report from South Korea's Maeil Business newspaper that claimed Nexon has made some inquiries into purchasing EA, the second biggest game publisher in the US (while Nexon was formed in South Korea, its current headquarters are located in Tokyo, Japan). Neither Nexon nor EA would officially comment on the rumors.

Nexon was formed in 1994 and has made its money primarily on free-to-play PC games such as MapleStory, Combat Arms and more. It has more recently released games for mobile devices.

So is such a deal likely? Gamesindustry International quotes Wedbush Securities analyst Michael Pachter as saying there are quite a number of reason why Nexon would not acquire EA, including the fact that Nexon's CEO would not give up control in such a deal and that Nexon would not be able to run EA's various businesses. He states:

Silly rumor. Day traders should take advantage, longer term investors should stay put, those uninvolved should wait until the furor dies down. I still love EA stock, but expect this to be denied by its management by the end of the day.

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