So EA recently acquired some company that makes racing car games, for $1.2Billion
They are effectively saying that the old companies offices, employees, capital, market, previous games all sum up to roughly 1.2B
So they lose that value in liquid cash but gain that value in physical property that can be resold later or made a profit off of in the future if it does well.
In a way its kind of like buying a stock on the market...
I guess my question would roughly be, why do these companies choose to invest 1.2B to acquire a company instead of trying to make a profit from smartly investing $1.2B around the stock market?
It seems like the market would be "easier" due to less complex overhead and more liquidity.
Is it because buying a company could theoretically return profit margins much higher than you could realistically make from trading stocks?
Submitted December 25, 2020 at 10:03PM by visually_disturbed https://ift.tt/3rnekV8
