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More on Koei, Tecmo merger plans -- Impress Watch

Companies expect to keep names for branding puproses.


A day after Koei and Tecmo announced that they were looking into a merger, Impress Watch has provided a few new details on the deal that it learned at a press conference held by the two firms on the 4th at the Tokyo Stock Exchange.

The big players from both parties were in attendance at the press conference. From the Koei side came President and COO Kenji Matsuhara and CFO Kenjiro Asano. From Tecmo's side came Chairman and CEO Yasuharu Kakihara and Tecmo Wave (a Tecmo subsidiary focusing on amusement facilities) CEO Houichi Sakaguchi.

One of the revelations at the press conference was that Koei will likely form a holding company as part of the deal. Koei representatives said at the conference that a merger deal with Tecmo would result in Tecmo stockholders getting a share in this holding company, although the specific amounts have not been decided.

The source of the merger talks was revealed at the press conference. Square Enix's buyout offer last week prompted Koei to contact Tecmo about beginning merger talks. Those talks are expected to take two months, with a plan revealed in early November.

Regarding a possible name for a merged company, the firms stated that their boards had agreed to keep the current Tecmo and Koei names for branding purposes.

The two companies offered reasons for why the feel the merger is appropriate. Tecmo's Kakihara noted that while Koei is strong in Asia, Tecmo is strong in North America, meaning there's not too much in the way of overlap. Noting that his own firm is doing online game development, Kakihara said that Koei is extremely advanced in this area, leading to a strong possibility for synergy.

Kakihara was asked if the Tecmo employees would prefer Koei or Square Enix. He gave a clear answer. "I believe they most want a stable development environment, and considering that point, I think it would definitely be Koei. However, I haven't directly asked the employees."

On the Koei side, chairman Keiko Erikawa, speaking to the company's board, is reported to have made note of the high synergy between the two firms. At the press conference, Matsubara noted that there's a family connection between Tecmo's former president and Koei founder Yoichi Erikawa and added that there are common points between the two firms as far as corporate culture goes.

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