After Hasbro announced plans to buy out Avalon Hill for about US$6 million it was a given that AH would only be the first in Hasbro's plans to expand into the computer games market. Some speculation was that MicroProse, in financial trouble for some time now, would be next.

It was.

Hasbro on Wednesday announced its plans to acquire MicroProse for $6 cash per share of stock outstanding, or a total of $70 million. The deal is expected to close in September. MicroProse would then merge with Hasbro Interactive. Will MicroProse undergo the same treatment that Avalon Hill received? There's no official word regarding what sort of moves toward consolidation Hasbro will take, but it is likely that MicroProse's payroll will be affected. (Informed sources have told GameSpot News that it wasn't Hasbro's idea to let internal development staffers at Avalon Hill go. Nonetheless, this is what happened, according to sources.)

"This acquisition is an incredible opportunity to combine the complementary talents of Hasbro Interactive and MicroProse," said Alan G. Hassenfeld, chairman and CEO of Hasbro Inc., in a statement. "MicroProse brings us great people, especially in research and development, and a strong international operation, which is very important to us as we continue to aggressively pursue the international marketplace."

"We're excited about joining Hasbro Interactive and the many growth opportunities we can pursue together," said Gilman Louie, chairman of MicroProse, in a statement. "Both organizations have clear strengths that will complement each other greatly."

As always, the acquisition requires shareholder approval, but the deal looks sweet for both sides. Hasbro on the purchase of MicroProse will receive decent European distribution, a larger selection of PC titles, and access into the console gaming world, where MicroProse has already had plans to develop for Sega's Dreamcast as well as the PlayStation and Nintendo 64.

On the flip side, today MicroProse announced its earnings for the first quarter of fiscal year 1999. The company reported a net loss of $7.8 million on a net revenue of $12.2 million (compared with a net loss of $8.3 million on revenues of $13.6 million in the same period last year). Included in the $7.8 million loss is the closure of the SimTex studio in Austin, which cost $431,000.

At the close of trading Tuesday, MicroProse stock was at 4 9/16. As of 2:30pm EST Wednesday, the stock was hovering at about 5 3/4 in heavy trading. Still, with Hasbro buying shares at $6 each, it should be a good deal for MicroProse stockholders.

Johnny Wilson, editor in chief of Computer Gaming World, said of the deal, "This just doesn't make sense for Hasbro. Hasbro has always been known for light, and I emphasize light, family entertainment. Even the Milton Bradley games that dealt with war or fantasy realms were light by the standards of that industry. Now, they're buying a company that has done best when it has published games with intricate detail - the Falcon series, the F-15 series, the Civilization series, the 'Master of' series and the M-1 series.

"I think this deal is destined for a culture shock that could easily turn into the Hatfields and the McCoys. MicroProse will need to be purged in Stalinist fashion in order to fit in with Hasbro's typical no-brainer approach. Hasbro would not be able to afford to let existing MicroProse management run the business with any autonomy because they haven't proven that they can still ship product."