NEW YORK (CNNfn) - Computer software company Electronic Arts on Thursday said it purchased DreamWorks Interactive LLC, maker of popular Sony PlayStation video games such "Medal of Honor," from Microsoft Corp. and DreamWorks SKG.|
Terms were not disclosed, but Wall Street experts said Electronic Arts (ERTS: Research, Estimates) would pay $10 million in cash for the multimedia developer.
The two companies have worked together over the past two years developing and distributing electronic games, including ones based on the films "Small Soldiers" and "Jurassic Park."
"EA brings world-class production processes, strong global distribution and an unmatched marketing infrastructure to add to DreamWorks Interactive's top-notch creative talent," said Steven Spielberg, famed film director and a principle at closely held DreamWorks SKG.
Dreamworks Interactive was formed as a joint venture in March 1995 by Microsoft (MSFT: Research, Estimates) and DreamWorks SKG, under the creative leadership of Steven Spielberg.
Credit Suisse First Boston analyst Lise Buyer cheered the deal, noting that it includes two in-process "Medal of Honor" titles, and the right of first refusal to the interactive rights to future DreamWorks films. In a note to clients, Buyer said the pact will dilute Electronic Arts' results in the current quarter by one cent per share, but will add to profits in the fiscal year 2001.
"This announcement further lengthens Electronic Art's lead over any other player in the entertainment space," she said. "We continue to believe the content will be increasingly valuable as we move toward a broadband world."
Shares of Electronic Arts rose 11/16 to 89-1/8 on Thursday afternoon in light trade on Nasdaq.