Sega Receives Bid From Rival Namco

Will Sonic the Hedgehog team up with Pac-Man?

Sega Corp., maker of “Sonic” video games, got a last-minute merger bid on Thursday from Namco, creator of “Pac-Man.”

Sega accepted a merger proposal in February from Sammy Corp., a Japanese maker of casino slot machines. The merger was to be completed next month.

Namco’s proposal, terms of which were not released, may spark a bidding war for Sega, which has roughly $1 billion in liabilities and posted operating losses three of the last five years.

A spokeswoman for Sega said the firm will consider the Namco offer while it continues its merger plans with Sammy.

“We will consider both Namco and Sammy at our upcoming board meeting,” said Sega’s U.S. spokeswoman Gwen Marker. Its board is scheduled to meet April 23 in Tokyo.

A Namco spokesman confirmed the offer but could not provide further details.

Shares of all three companies rose on the Tokyo Stock Exchange after the announcement. Sega rose 100 yen, the maximum gain allowed in a single day on the exchange, to 736 yen, or $6. Namco rose 23 yen to 1,799 yen, or $15. Sammy gained 125 yen to 2,615 yen, or $22.

Although Namco’s games business is more akin to Sega’s, Sammy brings better financial support.

Sammy built its empire on high-margin slot machines and is now expanding into video games. It posted a $200-million profit last year on $1.2 billion in sales, compared with Namco’s $17-million net income.

Founded in 1955 as an operator of rocking horse rides, Namco has become a powerhouse video game, arcade and amusement park company with $1.1 billion in annual revenue. Aside from Pac-Man, Namco also publishes the popular “Tekken” fighting games.

Namco already does business with Sega. Last year, the two joined Nintendo Co. in developing next-generation arcade technology, called Triforce. The graphics and processing technology is based on Nintendo’s GameCube home game console.