Activision Blizzard - World's Most Valuable Video Game Company

Now that Activision and Blizzard have a set a July date for their merger to be put up to final shareholder vote, it's time for the game industry analysts to do what they do best - analyzing. Lazard Capital analyst Colin Sebastian doesn't just think the joining of the two will form a big game company...he says they'll be the best, at least from a financial point of view.

"We believe the transaction is set to create a formidable new digital media powerhouse and the most valuable interactive entertainment company worldwide, unlocking the value of industry juggernaut World of Warcraft, and possibly also setting a new benchmark for profit margins among publicly traded video game pure-plays"

Along with the rosy outlook, Sebastian is raising the company's target price (the price at which buyers will purchase the stock) from $33 to $40.

Activision Blizzard formation set for July 8 [GamesIndustry.biz]

SCi, developers of Tomb Raider, Hitman and Deus Ex, have canceled 14 of their projects and plan on laying off 200 people and cutting their annual operating costs by £14 million as part of a company restructuring plan meant to get SCi back on track.

"Following our business review over the last six weeks, we are initiating a clear action plan based on three fundamental strands of activity: a radical change in our structure to a studio-led business, a top to bottom programme of product improvement and efficiency and a considerable cost reduction plan," Phil Rogers, Chief Executive of SCi Entertainment Group said, in a prepared statement. "To get SCi on track we have to act rapidly and effect change quickly. We must allow the world-class people that we have within the Group to focus on strong, profitable titles which will create the value our shareholders deserve."

A chief part of that plan is a fundamental change to the way the company does business with SCi shifting from the current centrally-controlled development and publishing model to a studio-led one, similar to the labels model that EA moved to last year.

Under the new structure, SCI would have studios based around "cornerstone products" like Tomb Raider, Hitman, Championship Manager and Deus Ex. The company is also creating an Eidos PLAY studio which will "fuse together casual and new media resources." Finally, production services will form part of the studio group and be relocated to Montreal from London.

I blame the Wii... well that and a company that has essentially been living off of three franchises for nearly two decades.

SCi Corporate

EA CEO/ Take-Two Chairman Talk Take Over Bid

I just got off the phone with Electronic Arts CEO John Riccitiello who called to talk about the back-and-forth going on right now between Take-Two and EA over Riccitiello's multi-billion dollar offer for the company.

I also, coincidentally, received Take-Two's comments on the whole, now-public, affair while on the phone with Riccitello. While the two seem to match up on the basic facts, their final analysis don't.

Nintendo Stock Rebounds After Fed Cuts Rate

Nintendo stock rebounded 6.3 percent, or 3,200 yen, after the U.S. Federal Reserve yesterday cut its benchmark interest rate.

The jump in Nintendo stock was part of a Japanese stock rebound spurred by the cut which came after the worst two-day drop in that stock in 17 years. Ironically the cut actually hurt Sony, which saw a 2.7 percent drop, spurring at least one investment group to change its rating on Sony from neutral to buy.

It's pretty amazing to me to think that the Japanese economy, right now, seems to be running on a game engine and that it's not even a next-gen one.

Japan's Stocks Rebound After U.S. Federal Reserve Cuts Rate [Bloomberg]

GameStop Stock Is Smokin' Hot

If you are interested in getting in on a little hot GameStop stock action and were waiting for a good time to sink some money into the company, between now and January 10th would be ideal, according to two industry analysts. Both Arvind Bhatia of Stern Agee and Leach, and Mike Hickey of Janco Partners believe that trends indicate a strong holiday earning period for the Texas-based company, and that means that purchasing before the company announces said earnings next week.

Hickey said the GameStop's holiday period typically represents 75 percent of Q4 reported sales, which means that "the street is looking for $2.027 billion in holiday sales, or +17 percent year-on-year."

Analysts: Buy GameStop Shares Now [Next Gen]

Nintendo: Wiis Hit Shelves This Weekend

Nintendo of America president Reggie Fils-Aime confirmed today what we first broke earlier this week, Best Buy and six other national retailers will be stocking Wii this weekend. And by stocking I mean they will be advertising the console in their weekly circulars (except Wal-Mart) and then throwing the consoles up on the shelves come the weekend and then running away.

Best Buy, Target, Wal-Mart, Sears, Kmart, Toys R Us and Circuit City are all stocking the Wii this weekend for those still on the hunt. We had several tips after our rumor story ran about the stock issue.

According to Best Buy tipsters it sounds like all stores will have at least 21 of the consoles with some carrying as many as 100. I've also heard that Best Buy is expecting a second shipment next week which is supposed to go straight to shelves. Most stores will get them sometimes before noon. The bad news is that rumor has it that that will be the last pre-Christmas shipment for Best Buy, though they expect more in early January.

Target, another tipster tells me, has a big stockpile as well, some stores have more than 100. So this weekend sounds like your best chance to pick up a Wii, unless you don't mind buying a raincheck.

Nintendo stock spiked at 64,800 yen on Wednesday, an all-time high, on speculation that the company might be bumping up its earning forecast again. The stock dipped back down to 64,300 by closing, a 2.7 percent increase over the day, Reuters reports.

"We believe Nintendo's talent in creating new markets, evident from the launch of the DS and Wii, could bring it close to the level of Apple, whose high valuations are due in large part to its innovative business model," Goldman said in a report.

All of this a day after Nintendo dropped $17 million on free (get out of a lawsuit) Remote Jackets. Nintendo's certainly riding high going into the holidays.

Nintendo shares hit record high on GS "buy" rating [Reuters]

Rumor Confirmed: Best Buy To Have Wiis Tomorrow

Nintendo Expecting Billions More Than Projected

Microsoft: Plenty O 360s

Plenty O PS3s But No Takers

Best Buy: Sit on PS3s, Sell Wiis

Rumor: Amazon About To Unleash PS3 and Wii

T2: Ten Years Worth of Financials Are Bad

Wiis As Rare as Hen's Teeth in Europe

Canadians: Best Buy Has PS3s Online

PS3s Spotted at Best Buys Today