Jamdat Investor Sues EA

As a follow-up to the announcement that Jamdat was being purchased by powerhouse Electronic Arts, Gamespot has the news that a Jamdat investor is suing to stop the business deal. From the article: "While Wedbush Morgan Securities analyst Michael Pachter said EA 'bought Jamdat for a fair price if they intend to get big,' some questioned the premium paid to become an instant player in the growing mobile market. Piper Jaffray's Anthony Gikas said the $680 million figure was actually $200 million too high. Even so, Gikas favored EA's purchase in a note to investors, telling them, 'don't sweat the small stuff.'"

Comments

Re:I Wonder

[Red Flayer]

"Does the person actually have a viable case here? The prices of Jamdat's stock did go up after the sale announcement to nearly the price per share they were going to pay."

That was because of the announcement. Of course people would buy for under EA's price, when they know they are going to be able to sell at EA's price.

This happens every time a company announces they are buying another company. The price on outstanding shares of the company being bought rises to about the level of the buy announcement.