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Gaming DICE merging with EA

Baron Samedi

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[size=1][b]Original article can be found [U][url=http://global.dice.se/press/pressreleases/?article=f7b266f0-5623-4fba-8ca8-6a12aa901721]here[/url][/U], for now.[/b]

Due to the first few sentences, I'll quote it here for 'posterity'.

[quote]Digital Illusions CE AB (publ) to merge into Electronic Arts EA Holding AB
Digital Illusions CE AB (publ) 2006-03-17
This press release may not be distributed or disclosed publicly in the United States of America, Australia, Japan, Canada or New Zealand.

This announcement is a translation of the Swedish announcement and in the event of any difference between the two, the Swedish announcement will prevail.

Digital Illusions CE AB (publ) to merge into Electronic Arts EA Holding AB

The Boards of Directors of Electronic Arts EA Holding AB (?EA Holding?) and Digital Illusions CE AB (publ) (?DICE?) have agreed that the companies merge.

- The Boards have unanimously agreed on a joint merger plan.
- The merger safeguards DICE?s future as a leading-edge game developer in a global and increasingly competitive environment.
- The merger consideration of SEK 67.50 per share to the shareholders of DICE is to be paid in cash.
- The merger consideration represents a premium of 30 %.
- The merger is subject to approval at the Annual General Shareholders Meeting of DICE which is scheduled for May 24, 2006.

?The merger resolves a stifling and complex situation while at the same time safeguarding DICE?s position as a leading-edge game developer in a global and increasingly competitive environment,? comments the Chairman of DICE, Thomas Skoglund.

Background and reasons
Electronic Arts Inc. together with its subsidiaries (collectively ?EA?) and DICE have had a close working relationship since 2002. In 2003, EA became the largest shareholder in DICE acquiring 1,911,403 Series B shares, corresponding to 18.9% of the outstanding capital and votes, and the parties concurrently entered into a 15-year strategic partnership agreement. On November 15, 2004, EA Holding issued a tender offer of SEK 61 per share for the remaining Series A shares in DICE. Having completed the tender offer and having bought shares in the market EA currently owns 67.9% of the shares in DICE. EA also holds warrants, which entitle EA to subscribe for 2,327,602 Series A shares. On a fully diluted basis, EA holds 73.9% of the outstanding capital and votes in DICE.

The Board of Directors of DICE believes that the current ownership situation creates uncertainty for DICE and its employees as the partial ownership prevents DICE from accessing EA?s tools, technology and financial resources. The board also believes that the current ownership structure will in the long term make it difficult for DICE to retain and attract talented employees and has led to an illiquid stock with insufficient research coverage.

Recognizing these challenges EA proposed to merge DICE into EA?s subsidiary EA Holding. After thorough deliberation and extensive exploration of alternative options, the Board of Directors of DICE has agreed that such a merger is in the best interest of DICE?s shareholders, DICE and its employees. Following completion of the merger EA will be able to share tools and technology with DICE, which will help DICE to navigate console transition as well as transition to next-generation platforms. In addition, DICE and its employees would become part of a group with significant financial resources, which will be necessary in order to be successful in the coming years as game development is becoming increasingly costly and competitive.

In addition, DICE?s minority shareholders will obtain liquidity for their shares at a premium of 30 % to the closing price on March 16, 2006.

Formal implementation of the merger
DICE?s Board of Directors has agreed to a merger in accordance with Chapter 23 of the Swedish Companies Act. The merger will be effectuated by DICE merging into EA Holding. Pursuant to the merger EA Holding will acquire the assets and assume the liabilities of DICE.

Final approval of the merger will be passed by a qualified majority for each class of shares (2/3 of votes casted and of the shares represented at the Annual General Meeting) by the Annual General Meeting of DICE. The Annual General Meeting is expected to be held on May 24, 2006.

Information to shareholders and merger plan
DICE?s and EA Holding?s Boards of Directors have signed a joint merger plan that the auditors of both companies will audit and issue statements on in accordance with the Swedish Companies Act. By approximately April 24, 2006, a shareholders? circular describing the transaction will be mailed to DICE?s shareholders and copies of the merger plan, with attachments and the auditors? statements will be available at the companies? offices. These will also be available on DICE?s website: [url]www.dice.se[/url].

Merger consideration
The merger consideration of SEK 67.50 per share to the shareholders in DICE will be paid by EA Holding in cash only. Should any dividend be paid after the date hereof or prior to the completion of the merger, the merger consideration will be reduced accordingly with the amount of such dividend plus interest thereon calculated at the Swedish reference rate plus two percent. The merger consideration represents a premium of 30% to the closing price of SEK 52.00 on March 16, 2006 and 28% to the volume weighted average share price during the past ten days of SEK 52.76. The merger consideration will be paid within ten business days after the Swedish Companies Office?s decision to register the merger, which is estimated to be in September 2006. No commission fees will have to be paid by the shareholders of DICE.

Board recommendation
DICE?s Board of Directors believes that a merger will benefit its shareholders and the company, and that the merger consideration is fair. Accordingly, the Board of Directors has unanimously approved the merger plan and recommends that the shareholders of DICE vote in favor of the merger plan at the Annual General Meeting scheduled to be held on May 24, 2006.

The Board of Directors of DICE has received a fairness opinion from its financial advisor, SEB Enskilda, stating that the merger consideration of SEK 67.50 is fair from a financial perspective for the shareholders of DICE.

Preliminary timetable (2006)
April 24, The merger plan is registered with the Swedish Companies Registration Office and is made available to the companies? shareholders together with the shareholders? circular and notice of the Annual General Shareholders Meeting

May 24, Annual General Meeting of DICE

Early June, The Swedish Companies Registration Office publishes notice to DICE?s creditors

Early September, The Swedish Companies Registration Office issues permission to implement the merger decision

September, The Swedish Companies Registration Office registers the merger and the merger consideration is distributed to the shareholders within ten business days thereafter

Upplands Väsby, March 17, 2006
Electronic Arts EA Holding AB
Board of Directors

Stockholm, March 17, 2006
Digital Illusions CE AB (publ)
Board of Directors

For further information, please contact:
EA: Tiffany Steckler, EA Corporate Communications, +44 1932 450 703
DICE: Thomas Skoglund, Chairman of the Board, +46 70 520 64 70 or Patrick Söderlund, CEO, +46 8 658 78 01

Electronic Arts (EA), headquartered in Redwood City, California, is the world's leading interactive entertainment software company. Founded in 1982, EA posted revenues of USD 3.1 billion for the fiscal year ended March 31, 2005. The company develops, publishes, and distributes interactive software worldwide for video game systems, personal computers and the Internet. In FY2005, EA had 31 titles that sold more than one million copies. EA markets its products under three brand names: EA SPORTS(TM), EA GAMES(TM) and EA SPORTS BIG(TM).

For more information, visit EA?s homepage and online game site at [url]http://www.ea.com[/url].

Founded in 1992, Digital Illusions is an award-winning developer of interactive entertainment based in Stockholm, Sweden, with offices in Canada. The company has approximately 200 employees and develops games for the leading platforms. Recent titles include Battlefield 1942 (elected Game of The Year) and Battlefield 2 for Electronic Arts, RalliSport Challenge 1 & 2 for Microsoft. Digital Illusions? Series A share is listed on Nya Marknaden (an unofficial marketplace where smaller companies? shares can be traded in the Stockholm Stock Exchange?s trading system, SAXESS) under the symbol DICE A.

For more information, visit Digital Illusions? homepage at [url]http://www.dice.se[/url]. [/quote]

What does everyone think about this? I wasn't sure whether to put this in here, or the PC/mac forum... but EA/DICE are responsible for many things, though the one of key interest to me is Battlefield 2, a PC game [with adaptations for consoles too...][/size]
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