MICROSOFT EYES ASIA AS CAPCOM SKIRTS RUMOURS
Capcom comments on rumours that the company is in high level talks with Microsoft regarding a buyout as Xbox spreads across the Far East

13:27 Capcom has today reacted to rumours that the company is currently in negotiations with Microsoft regarding possibly selling the company.
While the statement says little specifically about the matter, it does address the possible source of the rumour: Capcom's financial results this year point to a significant loss.

"Capcom has made some financial adjustments in Japan that could cause the group to declare a loss in this fiscal year," said a spokesperson for Capcom Europe. "The adjustments relate to extraordinary items related to real estate. This does not reflect any downturn in the performance of the general business of the software development and sales operations."

UK insiders today have claimed that talks have definitely taken place between the two parties, while pointing out that Sega is now almost certainly off limits to Microsoft due to the cost of a sale.

Sega was long-rumoured to be the favoured Japanese target for the American giant, although the Sonic manufacturer is on the verge of spinning money for the first time since the beginning of the financially dire Dreamcast days. If you thought Rare was expensive at £240 million, think again: Sega's assets alone are worth at least $2 billion (£1.3 billion), then you have staff costs, properties and Yu Suzuki's legendary expenses account. "Let's spend some kerazy money!" Bill Gates probably didn't shout recently.

According to those in the know, Microsoft, desperate for credibility in the Far East, is now fighting tooth and nail to make a Japanese acquisition, so if nothing comes of the Capcom talks you can still expect an announcement of some kind in the not too distant future. The hallowed name of Konami has even been thrown around today.

Keep your eyes peeled for more info as Microsoft begins, slowly but surely, to assimilate the world videogames industry. Resistance is futile...

Patrick Garratt

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way to go chuck!