dallas said:
Legend11 said:
dallas said:
Yes, MS's profits have been nice indeed, but MS has to divide this money among its divisions, and still leave enough for dividends but do you really think that Microsoft would allocate a much greater than normal amount to the X-box by the act of purchasing Square Enix?
Thirdly, MS has about $6.1 billion reserved in cash. A purchase of SE would take this down to zero or very close to it, so MS would have to go into debt to do this. Not only would MS have to pay a premium for a company that it couldn't strategically make much use of since its strongpoint in games is america which traditionally hasn't been that big on RPG's, but it would have to go into debt in order to do so thus defeating your argument. |
Umm I really can't see Microsoft's cash reserves at $6.1 billion... I mean it was at $28.9 billion on April 1st, 2007 and it's extremely doubtful that they would have spent over $22 billion since then (They only spent $7 billion on aquisitions and capital expenditures over the past 5 years prior to that). Also buying Square would not put Microsoft into debt but it would probably be a hard sell to their shareholders since it's not like Square Enix itself could ever generate the extra cash back (they'd likely only sell to Microsoft for some outrageous amount far above what they'd sell to Sony or Nintendo) and the company (Square Enix) would likely lose revenue if they became Xbox 360 exclusive (although since they're making DS and PSP games as well it likely wouldn't be that major of problem like it would have been when Microsoft originally tried to buy SquareSoft in 1999). |
I'm not asking you to accept my opinion, rather I am only asking that you look the figures up and decide for yourself. Go to this link showing microsoft's financial statements, and then look at its balance sheet, the cash portion of which specifically. You will see that MS does indeed have about $6.1 billion in cash so yes, they would have to get financing for the deal which would most likely be debt. http://www.microsoft.com/msft/earnings/FY07/earn_rel_q4_07.mspx |
According to the balance sheet you linked to they have $23.41 billion in cash reserves as of June 30th, 2007. They have $17.3 billion of that in short term investments meaning they invested the money but will be getting it back in less than one year.
Edit: Oops when you said "reserved in cash" I thought you meant cash reserves, so I guess that's where the confusion comes from.
