14 DAY TRIAL // The publicly traded shares of video game publisher Electronic Arts have climbed by a healthy 2 percent in order to reach the highest level of the last year as a private investment fund called Relational Investors signaled that it aims to be more involved in the operation of the company.
The two entities have announced that Ralph Whitworth, who is the principal of Relational Investors, could be appointed to the board of directors of Electronic Arts starting with September 15 of this year.
The move can happen as long as the private investment fund continues to have more than 6 million shares of Electronic Arts stock.
This means that Relational Investors will have about 1.8 percent of the public stock and the fund is directing investment of more than 6.4 billion dollars overall.
John Riccitiello, who is the chief executive officer of Electronic Arts, has stated, “Electronic Arts and Relational have engaged in a series of discussions about EA’s significant progress in improving its business and its prospects for continued growth and improvement.”
He added, “This agreement signals Relational’s confidence as we transform EA from a packaged goods company to a fully integrated digital entertainment company.”
Whitworth said, “EA’s performance over the last several months and the rapid growth of its digital business demonstrate the fundamental strength of its business franchise and management’s ability to extend the company’s industry leadership. We are pleased to be closely engaged with EA’s management team and we are confident in the company’s growth potential.”
The investment from Relational Investors is seen as a sign of trust in the long-term potential of the video game publisher, which has been having a tough time during the economic crisis.
John Riccitiello has implemented an aggressive program designed to turn the company around which included laying off workers and focusing on quality of games and not just quantity.