A few hours ago, Electronic Arts announced that it had purchased VG Holdings, the holding company for two of the largest remaining independent developers, BioWare Corp. and Pandemic Studios. What's interesting is that VG Holdings had been the property of Elevation Partners, in which Electronic Arts CEO John Riccitiello had been a managing director until his return to EA earlier this year. Based on the enthusiasm that Riccitiello expressed for the work of BioWare and Pandemic during our three-part Q&A with him last year while he was still at Elevation--click on the following links for Part I, Part II and Part III--we suspected that he would seek to reacquire BioWare Pandemic upon his return to EA. Similarly, we believed that following the announcement of his departure in February, Elevation Partners would look to get out of the game business given that the chief architect of that strategy had fled the coop.
At the time, Riccitiello's replacement at VG Holdings, Greg Richardson, rebuffed our suggestion in the following exchanges:
Should people read anything into the fact that a deal was announced for EA Partners to publish Mercenaries 2 not long before Riccitiello's return to EA was made public?
[Laughs] No. We've been joking around a little bit about that, that part of the deal was that we were going to trade John for the relationship [with EA.] But no, not in the least. We think that EA is a great partner for us on Mercenaries 2, and we're excited about working with them on the launch. We have some other wonderful publishing partners: Microsoft on Mass Effect; Take-Two is working with us on Jade Empire--it launches on the PC later this month--and we've got several other relationships we haven't announced with other publishers not named Electronic Arts.
In the next couple of months, we're going to be looking for publishers for Dragon Age, a game that we've announced that's the absolute spiritual successor to what BioWare's built in the fantasy role-playing game space, just taken to a whole different level. And then another game we haven't announced yet from Pandemic, and we'll be looking for partners there as well. While EA will be one of them we'll consider, they're just going to be one of what we think is going to be a lot of parties interested in working with us....
Apart from the purchases of BioWare and Pandemic, I haven't seen much announced on the mergers and acquisitions front from Elevation Partners despite its initial $2 billion in capital. How much of an appetite is there for buying more companies now that Riccitiello has left?
So let's separate that question into two pieces. There's a question there in relationship to Elevation's investment strategy that would be a great thing for you to talk to one of the partners there. Although in addition to investing in us, they've also invested in Move.com, which is one of the leading real estate Web portals. If you're looking to buy or sell a house, that's where you usually end up. They also have an investment in Forbes, which is both an online content deliverer and a magazine that's obviously been around for a long time, a great brand. So they've made other investments, and they'll continue to make other investments. But again, that's a great question for you to follow up directly with those guys on.
In terms of BioWare/Pandemic and the videogame space, look, we're growing like gangbusters. We've added close to 150 people in the last 18 months. We've opened a new studio in Austin, Texas. We've expanded our studio presences in Edmonton, L.A. and Australia. We've got a lot of opportunities that we continue to look at, and maybe some exciting announcements to look forward to in the next coming months. So our ambition and our sense of the opportunity that we have with this unique approach that we're taking remains exactly the same, and I think people will be excited to see how it evolves.
Smoke, meet fire.
BioWare is best known for its work on franchises like Baldur's Gate and Star Wars: Knights of the Old Republic. Microsoft will be publishing BioWare's forthcoming Mass Effect in November, but EA has indicated that since the IP had belonged to VG Holdings/BioWare, EA know owns the property. Pandemic is recognized for its work on such titles as Mercenaries and Destroy All Humans, and EA had already struck a deal to publish Pandemic's Mercenaries 2. According to EA, ten properties are underway between BioWare and Pandemic, several of which have not been named or officially announced; among them, a massively multiplayer game being developed by BioWare in Austin, Texas.
Click on the link below for EA's press release announcing the deal.
Loading Menu