Tecmo answers Square Enix questions regarding rejected merger proposal

While we may no longer see an epic fantasy RPG starring our favorite Dead or Alive babes, Square Enix still had some unresolved issues with Tecmo, after failing its attempt at negotiating a corporate merger. After having their friendly proposal spurned, Square Enix forwarded three questions regarding Tecmo’s rejection. Read the answers to these questions after the jump.

While we may no longer see an epic fantasy RPG starring our favorite Dead or Alive babes, it still seems that Square Enix had a couple of things left to say to Tecmo after failing its attempt at negotiating a corporate merger.

After having its friendly proposal spurned, Square Enix forwarded three questions regarding Tecmo’s rejection, most of these tied to the company’s decision to tie up with Dynasty Warriors‘ Koei:

1. Please confirm that the decision on the start of discussions with KOEI toward integration of management is the reason for rejection of the Proposal.
2. If that is the case, please clarify concretely that major terms of integration of management with KOEI (form of the integration, stock prices assumption, integration ratio and so forth) are favorable for TECMO’s shareholders than the Proposal.
3. If not, please clarify that TECMO has an alternative plan, which is favorable for TECMO’s shareholders than the Proposal.

Tecmo only recently answered these questions, along with an explanation to their move to go hand-in-hand with Koei instead.

1. The reason why the Tecmo board members did not accept this offer is because of the decision to begin merger talks with Koei.
2. Supposing this is the case, then the plan to merge with Koei (form of the integration, stock prices assumption, integration ratio and so forth) is concretely beneficial to Tecmo shareholders.
3. Supposing this isn’t the case, then we would disclose alternatives that would be advantageous to shareholders.

To answer Square Enix’s proposal within the time frame of one week provided little room for negotiation and discussion. Conversely, regarding the proposal from Koei, there is time for management to consider how to integrate and most likely arrive at ultimately raising our corporate value. This is why we have begun talks with Koei concerning corporate integration.

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