As reported by Barron's, Doug Creutz, analyst for Cowen and Company believes that the likelihood of Microsoft taking over EA is "inconsequentially low."
"EA gets over 30% of its revenue from Sony PS2 and PS3 and the Nintendo Wii, which would almost certainly disappear in the event of a Microsoft acquisition, since presumably the whole point of the acquisition would be to secure EA's products as Xbox 360 exclusives. EA gets another 10% of revenue from Sony PSP and Nintendo DS handhelds, which would conceivably be at risk in event of a Microsoft acquisition."
According to the analyst "There is simply no way the math works due to the massive hit to EA's revenue and earnings post acquisition. This is even assuming such a deal would pass regulatory muster, which we find highly doubtful."
EA's shares rose $1.31, or 7.1 percent amid the rumors of the takeover.
Microsoft later released a statement saying the following: "We have no plans to acquire EA. They remain a very important partner to us. No acquisitions."
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