Glu Mobile Updates Guidance to Include Recent Acquisition of Superscape; Provides Further Update of Tender Offer
25 March 2008 - 7:05AM
Business Wire
Glu Mobile Inc. (�Glu�) (NASDAQ:GLUU) today announced that as of
3:00 p.m. GMT on March 20, 2008, it had received valid acceptances
representing approximately 92.97% of the issued share capital of
Superscape Group plc (�Superscape�). As such, the Company has
applied the provisions of sections 979 to 991 (inclusive) of the
Companies Act 2006 to acquire compulsorily all remaining Superscape
shares on the same terms as the tender offer. Greg Ballard,
president and chief executive officer, Glu, commented, �We�re
excited to be joining forces with Superscape, a pioneer in the
mobile games industry. Superscape�s strong heritage in 3D
technology, high-quality original titles and innovative white label
programs complement our existing world-class operations. This
acquisition is an important achievement in becoming the leading
mobile games publisher in the world.� Rocky Pimentel, chief
financial officer, Glu, added, �We expect Superscape will have a
positive impact on our financial results. While the integration of
Superscape will continue through most of this year, we currently
anticipate that the acquisition will be neutral to non-GAAP
earnings until the fourth quarter, at which time it will become
accretive. Accordingly, we are raising our full year guidance.� The
Company is providing guidance today to reflect Superscape�s
expected contribution to Glu for the first quarter and the full
year 2008. Because Glu declared the tender offer unconditional in
all respects on March 7, 2008, Superscape�s results will be
consolidated into Glu�s financial results as of that date.
Furthermore, although Glu expects to ultimately acquire 100% of the
outstanding shares of Superscape, the Company will record a
minority interest to reflect the portion of shares that it does not
own until it has acquired 100% of the outstanding shares. On
February 11, 2008, the Company provided guidance for the first
quarter, ending March 31, 2008, of revenue in the range of $18.0
million to $18.4 million, GAAP net loss of ($0.17) to ($0.18) per
basic share, and non-GAAP net loss of ($0.04) to ($0.05) per basic
share. Today, Glu stated that it expects to exceed its prior
guidance on revenue for the first quarter of fiscal 2008 and
reported that sales of certain Hasbro classic titles had been
continued through March 31, 2008, a later date than previously
expected. These continuations contributed modest additional
one-time game download revenue incremental to Glu�s prior guidance.
The Company stated that it will not receive any further extensions
of the licenses for the Hasbro classics. In addition, Superscape
will contribute approximately three weeks of financial results to
Glu�s first quarter results. Glu currently expects that this
contribution from Superscape will add approximately $800,000 of
incremental revenue to the first quarter. On a non-GAAP basis, the
Company expects the acquisition to be neutral to earnings. The
acquisition will be dilutive to GAAP earnings due to the impact of
non-cash amortization of intangibles, acquired in process research
and development, stock based compensation and other transitionary
expenses. On February 11, 2008, the Company provided guidance for
the 2008 fiscal year, ending December 31, 2008, of revenue in the
range of $83.0 million to $87.0 million, GAAP net loss of ($0.31)
to ($0.36) per basic share, and non-GAAP net income of $0.15 to
$0.20 per diluted share. Superscape will contribute approximately
ten months of financial results to Glu�s 2008 results. Glu is
currently completing its evaluation of Superscape�s 2008 title
plans including eliminating overlapping titles. However, for
reference, in its fiscal year ended January 31, 2008, which
represents a full twelve months, Superscape will report unaudited
revenue of approximately $14.5 million. Glu currently expects that
Superscape will add approximately $12 million of revenue for the
full year, reflecting approximately 10 months of revenue beginning
on March 7, 2008. On a non-GAAP basis, the Company expects the
acquisition will add approximately $0.01 per diluted share. The
acquisition will be dilutive to 2008 GAAP earnings due to the
impact of non-cash amortization of intangibles, acquired in process
research and development, stock-based compensation and other
transitionary expenses. Glu will hold a conference call at 2:00
p.m. Pacific Time (5:00 p.m. Eastern Time) on Monday, March 24,
2008 to discuss guidance for the Company�s acquisition of
Superscape. Please dial 800.299.7089, or if outside the U.S.,
617.801.9714 with passcode 78593871 to access the conference call
at least five minutes prior to the 2:00 p.m. PT start time. A live
webcast and replay of the call will also be available at
http://www.glu.com/corp/Pages/investors.aspx under the Investor
Calendar and Webcasts menu. An audio replay will be available
between 4:00 p.m. PT, March 24, 2008, and 11:59 p.m. PT, April 1,
2008, by calling 888-286-8010, or 617-801-6888, with passcode
79538667. About Glu Glu (NASDAQ:GLUU) is a leading global publisher
of mobile games. Its portfolio of top-rated games includes original
titles Super K.O. Boxing!, Stranded and Brain Genius, and titles
based on major brands from partners including Atari, Activision,
Konami, Harrah's, Hasbro, Warner Bros., Microsoft, PlayFirst,
PopCap Games, SEGA and Sony. Founded in 2001, Glu is based in San
Mateo, Calif. and has offices in London, France, Germany, Spain,
Italy, Hong Kong, China, Sao Paulo and Chile. Consumers can find
high-quality, fresh entertainment created exclusively for their
mobile phones wherever they see the 'g' character logo or at
www.glu.com. About Superscape Superscape is the world's leading
publisher of 3D mobile games. Superscape is quoted on the London
Stock Exchange and has corporate offices in San Clemente,
California (USA) and Fleet, Hampshire (UK), together with a
development and production facility in Moscow. This news release
contains certain forward-looking statements with respect to the
plans, objectives, expected performance and anticipated financial
results of Superscape and Glu. Such statements relate to events and
depend on circumstances that will occur in the future and are
subject to risks, uncertainties and assumptions. There are a number
of factors which could cause actual results and developments to
differ materially from those expressed or implied by such
forward-looking statements including, among others, the risk that
the offer is not consummated in a timely manner (if at all); the
risk that the anticipated benefits of the combination of the Glu
and Superscape businesses will not materialize; the enactment of
legislation or regulation that may impose costs or restrict
activities; the re-negotiation of contracts or licenses; risks
regarding the loss of key wireless carrier customers or
subscribers; risks relating to the integration of the businesses of
Glu and Superscape including that such integration efforts may
result in unforeseen operating difficulties and expenditures; the
risk that the title plans and operations of Superscape and Glu will
not be combined as anticipated and that the expected cost
reductions will not be realized; risks related to the diversion of
management's attention from ongoing business operations as a result
of the offer process; risks relating to employee retention;
fluctuations in demand and pricing in the mobile industry;
fluctuations in exchange controls; changes in government policy and
taxations; industrial disputes; war and terrorism. This list is not
exhaustive of the factors that may affect the forward-looking
information. These and other factors should be considered carefully
and undue reliance should not be placed on such forward-looking
information. Although this announcement has attempted to identify
important factors that could cause actual actions, events or
results to differ materially from those described in
forward-looking statements, there may be other factors that cause
actions, events or results to differ materially from those
anticipated, estimated or intended and therefore there can be no
assurance that forward-looking statements will prove accurate.
Forward-looking statements contained in this news release in
respect of Superscape and/or Glu are made as of the date of this
news release based on the opinions and estimates of management.
Subject to requirements to update under any applicable regulation
or law, Superscape and Glu disclaim any obligation to update any
forward-looking statements, whether as a result of new information,
estimates or opinions, future events, results or otherwise.
Information on some risks and uncertainties are described in the
"Risk Factors" section of Glu's Form 10-Q for the quarter ended
September 30, 2007, filed with the U.S. Securities and Exchange
Commission on November 14, 2007. Copies of the Form 10-Q are
available from Glu's web page at www.glu.com. For a further list
and description of such risks and uncertainties, see the reports
filed by Glu with the U.S. Securities and Exchange Commission. Glu
disclaims any intention or obligation to update or revise any
forward-looking statements, whether as a result of new information,
future events or otherwise. GLU MOBILE, GLU, SUPER K.O. BOXING!,
STRANDED, BRAIN GENIUS and the 'g' character logo are trademarks of
Glu Mobile.
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