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  1. Technology
March 22, 2005

Let battle commence for Lara Croft creator Eidos

Just hours after US private equity group Elevation Partners offered failing video games developer Eidos a lifeline, rival SCi Entertainment Group has made an aggressive takeover counter bid that could set off a takeover war.

By CBR Staff Writer

London, UK-based SCi is said to be offering GBP 76m for Eidos, the creator of the popular Lara Croft series, in a move to challenge the GBP 71m bid made by Elevation Partners. It is also expected to tender one of its shares for every six in Eidos and is apparently prepared to raise an extra GBP 60m to repair the financial damage suffered by the company.

SCi is entering the takeover battlefield armed with a significant weapon – the 20% share in Eidos that investment bank Schroders has provided in support of its campaign, in direct defiance to the wishes of Eidos’ directors to accept the earlier offer by Elevation Partners, a venture capital outfit that includes Bono of rock group U2.

Eidos has been seeking out a buyer since it found itself in the red eight months ago. It initially viewed the intervention from Elevation Partners as an end to the uncertainty cast over its future. The US organization also promised to suspend the initial launch of Eidos’ new hardware to buy it time to improve and expand its research and development.

While some people in the Eidos camp have expressed doubts about SCi’s ability to handle a large, international operation, the company has said it will consider the counter offer by the video game publisher, which said Eidos could benefit from its strategy of outsourcing game development and a reported combined market value of GBP 232.4m.

SCi itself, according to media speculation, is looking to boost its own profits and save GBP 12m a year by ending Eidos’ full listing and sacking its senior management.

Eidos is anticipated to publicize a further announcement in the near future.

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