Now SCi makes ?76m Eidos offer

A second offer has been made for British publisher Eidos, with rival firm SCi announcing details of a stock offer which would value each share in the company at around 53.6 pence - significantly higher than last night's offer from Elevation Partners.

SCi's offer, announced to the City today, would see the Clapham-based publisher acquiring the entire share capital of Eidos in a deal which swapped one SCi share for every six Eidos shares held.

At SCi's Monday closing price of 321.5 pence, that would value each share in Eidos at 53.6 pence, and the company as a whole at UKP 76.1 million. SCi plans to enlarge its share capital to enable this offer, and will also raise some UKP 60 million from a placing and open offer of new shares to provide the combined group with a solid balance sheet.

The announcement of the deal muddies the water around the future of Eidos somewhat, as it comes hot on the heels of an offer last night from US private equity firm Elevation Partners, which was seen by many as a done deal.

Elevation, a private firm co-founded by former EA president John Riccitiello, is offering 50p per share in cash - a few pence lower than SCi's offer.

If SCi's offer is accepted, it would make the company into by far the largest publisher in the UK, and the combined firm would be a fairly major player on the world stage - a fact which SCi ranks high in its list of reasons for making the offer.

The company has presented a terse set of bullet points outlining its plans for Eidos, including the re-launch and revival of some brands, the improvement of the company's delivery performance, further investment into development studios, and major cost savings in terms of administrative expenses.

Moreover, SCi believes that Eidos' poor performance on the stock market has been a key factor in demotivating staff at the embattled publisher, and as such it plans to include Eidos staff in SCi's option arrangements going forward.

Notably for the British games industry, of course, this is the only way forward yet proposed for Eidos which would lead to the company and its intellectual property remaining in UK hands.

"We believe that this is an excellent opportunity for both Eidos and SCi shareholders to invest in a major computer games publisher at a time when the global market has never been bigger," enthused SCi chief executive Jane Cavanagh, commenting on the offer.

"Whilst Eidos' brands, studios and staff have significant potential, its continued financial problems appear to have resulted in rushed development cycles, missed deadlines and products that have not done justice to their brands," she continued. "We are completely confident that the application of our successful business model across the Enlarged Group will significantly enhance shareholder value for both SCi and Eidos shareholders."