Nomura bullish on Shanda games acquisitions to raise target prices

July 28, Shanda Games announced the acquisition of two platform companies from the parent company's Shanda Network to promote the development of its mobile strategy. In this respect, the analysis of Nomura Securities research shows that this is a grand game integration platform for the development of mobile gaming business Strategic significance of the initiative. The deal will substantially increase the revenues of Shanda games by eliminating the costs of associated transactions. From a strategic and financial standpoint, Nomura is bullish on this approach. At the same time, the Nomura research also expressed a relatively cautious view on the transaction between affiliated companies. Nomura points out that management expects the future earnings per share of Shanda to rise 40% to 50% after the acquisition ends. Nomura said it maintained the "buy" rating of the grand game unchanged and raised its target price to $6.0 to reflect a 2014-year forecast for the grand game after the rise.