In the wake of Sega's shock announcement that it intends to merge with Sammy, analysts are gathering en masse to question the move.
Sega, struggling to prove a profitable future for its widespread, multiplatform videogames business, saw its stock take a battering on the Tokyo exchanges yesterday, as a clamour to offload stock ensued. At close if business, Sega's share price was down 8.4 points.
Investors were equally cautious about Sammy's future, with losses of 7.7%, despite a negligible amount of trading.
However, Sammy, cash rich and debt free, with a strong, albeit localised, consolidated business comes into the deal with an eye on expanding its videogames business. "We've been reinvesting money generated from the pachinko business into new entertainment businesses ranging from amusement to new technology," Sammy's Satomi told reporters after the merger's announcement. "We need Sega's brand to become known around the world."
Game franchises such as Guilty Gear have performed well for Sammy, though its main business is Pachinko, the wildly popular Japanese ball-bearing gambling game. Sega also manufactures Pachinko machines, though on a smaller scale.
It is expected that Sega wishes to learn from Sammy, the fundamentals of running a consolidated business. Indeed, all of Sega's recent actions, including a large-scale shuffle of its upper management echelons, have been focussed on this.
As ever, there's more to this than meets the eye. As soon as we find out, we'll let you know.
Sega, struggling to prove a profitable future for its widespread, multiplatform videogames business, saw its stock take a battering on the Tokyo exchanges yesterday, as a clamour to offload stock ensued. At close if business, Sega's share price was down 8.4 points.
Investors were equally cautious about Sammy's future, with losses of 7.7%, despite a negligible amount of trading.
However, Sammy, cash rich and debt free, with a strong, albeit localised, consolidated business comes into the deal with an eye on expanding its videogames business. "We've been reinvesting money generated from the pachinko business into new entertainment businesses ranging from amusement to new technology," Sammy's Satomi told reporters after the merger's announcement. "We need Sega's brand to become known around the world."
Game franchises such as Guilty Gear have performed well for Sammy, though its main business is Pachinko, the wildly popular Japanese ball-bearing gambling game. Sega also manufactures Pachinko machines, though on a smaller scale.
It is expected that Sega wishes to learn from Sammy, the fundamentals of running a consolidated business. Indeed, all of Sega's recent actions, including a large-scale shuffle of its upper management echelons, have been focussed on this.
As ever, there's more to this than meets the eye. As soon as we find out, we'll let you know.
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