CDP's Ambitious Plans Caused by Takeover Threat? Analysts Deny
CD Projekt's recently announced ambitious plans have, for some, become a hint that the Polish company is preparing for being acquired by a larger entity. What do industry analysts make of this?
After the slip-up that was Cyberpunk 2077, CD Projekt is slowly getting back on track. This is evidenced by the increasingly better moods among the players, but also by the Polish company's far-reaching plans. Recall that just a dozen days ago the company announced more games from the Witcher universe, the sequel to Cyberpunk 2077 and an entirely new IP. In turn, all titles are to be created in relatively short intervals.
As it turns out, according to Tyler Wilde, a journalist for PC Gamer, these announcements combined with Marcin Iwinski's resignation as vice president could mean that the company has become the target of a takeover by a larger entity.
Encouraging investors or scaring them away?
According to speculation, such ambitious plans could be a way to attract the attention of larger companies - the studio is back on the headline (this time in positive context) and many leading players in the market would like to have another The Witcher in their portfolio. Moreover, the journalist claims that this could also be part of a special tactic to scare off potential buyers (an increase in the share price may discourage investors from acquiring CDP).
The editor vs. the analysts
However, analysts disagree with the above (bold) thoughts. Rhys Elliott from Newzoo argues that the company's plans are not unusual among similarly sized game developers. Admittedly, it may be somewhat surprising to announce them openly, but according to the specialist CD Projekt probably wanted to take advantage of the good mood after the release of the anime Cyberpunk: Edgerunners.
"If [CD Projekt] revealed this roadmap before fixing the state of Cyberpunk 2077, there would have been an outcry from the public and investors, further increasing negative sentiment around the company. Now that public sentiment around the company is becoming more positive, CD Projekt is hoping to leverage that sentiment and build off it to completely turn the negative narrative. The stock market also responded positively to the announcements," Elliott said (via PC Gamer).
It is hard to disagree with the analyst's opinion. CDP's share price has risen by about 28% over the past month.
"The company wants all to know it has learned from its mistakes, is doubling down on its most successful strategies, and has many projects in the pipeline. This is music to the ears of investors," he added.
Interestingly, these are not isolated observations. In a similar vein spoke another analyst - David Cole from DFC Intelligence.
"It seems to me that the plans were announced to reassure current and potential investors that there are many exciting things in the pipeline," the specialist said.
Who could take over CD Projekt?
Admittedly, we can not rule out the possibility that in the future CDPR will come under the wings of a larger company. The aforementioned Rhys Elliott pointed out two entities that could be interested in such a purchase. Among them are China's Tencent and Savvy Games Group from Saudi Arabia.
So there is nothing left for us to do but wait to see what happens. Nevertheless, it's hard to resist the impression that PC Gamer's editor got a bit carried away. Especially when we consider last year's assurances of CD Projekt's CEO, Adam Kicinski, about the company's desire to remain independent.
