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EA approaches Take-Two shareholders in takeover bid

Electronic Arts, clearly not taking “no” for an answer, has upped its efforts to acquire rival games company Take-Two Interactive, publisher of BioShock and the Grand Theft Auto series. With no headway made in negotiations with Take-Two management, EA is now going directly to the shareholders with intent to purchase all currently outstanding shares of common stock of TTWO.

EA is offering $26 cash per share, a figure that it has previously offered Take-Two management without success, with a total cash deal of $2 billion in the case of a complete buyout.

“This is a great opportunity for Take-Two shareholders. We believe Take-Two investors will see our tender offer as the best way to maximize the value of their investment in Take-Two. This tender offer provides a clear process to complete the proposed transaction,” declared EA CEO John Riccitiello.

EA states that the offer represents a 64 percent premium over Take-Two stock price on February 15, but now the $26 bid sits at around 4.4 percent above the current price. The tender offer is scheduled to expire April 11, 2008, unless the tender offer is extended. The release of Take-Two’s largest title of 2008, Grand Theft Auto 4, will be hitting stores two weeks after the close of EA’s offer.

Riccitiello added, “For EA shareholders, the combination would add additional intellectual properties to our already strong portfolio and welcome Take-Two's talented creative teams to the great development organization we've built at EA.”

Take-Two Interactive’s board of directors, intent on retaining control of the company, issued a notice to its shareholders shortly after EA’s bid, urging them not to accept.

“The Board of Directors of Take-Two Interactive Software, Inc. today recommended that Take-Two stockholders take no action at this time in response to the announcement by Electronic Arts Inc. that it has made an unsolicited conditional tender offer to acquire all of Take-Two's outstanding shares of common stock for $26 per share in cash,” read the release.

Take-Two added that it would re-examine the offer once again. “Consistent with its fiduciary duties, and in consultation with its independent financial and legal advisors, Take-Two's Board will review and consider EA's offer, and within 10 business days, will advise Take-Two's stockholders of the Board's position regarding the offer as well as its reasons for that position.”

This marks the second time EA has readied $2 billion in hopes of acquiring Take-Two Interactive. In February, EA made an offer of $25 per share, eventually upping it to $26, only to be rejected by Take-Two’s board.

Take-Two’s public statement at the time was, “After careful evaluation, the Board has determined that EA's proposal substantially undervalues Take-Two’s robust and enviable stable of game franchises, exceptional creative talent and strong consumer loyalty. We believe EA's unsolicited offer is highly opportunistic and is attempting to take advantage of our upcoming release of Grand Theft Auto IV, one of the most valuable and durable franchises in the industry.”

Shares of Take-Two jumped immediately following EA’s offer last month, going from $17 to the most recent trading price of $25.63.



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EA's new slogan should be.
By vhx on 3/13/2008 4:58:13 PM , Rating: 4
EA: Ruining franchises since 2000.

Seriously this would be a shame to see Take Two's game become a shadow of their former selves. I saw what they did to Westwood, (Command and Conquers series) and just shook my head. Not to mention the sports games seem to somehow get worse every year. I don't even play sports games, but my friends who loved them stopped buying their games or paying attention to new releases. I read the reviews and I don't blame them.

I would hate to say this would be the beginning of the end if they got them. However, I can picture in my mind a train that is gaining more momentum with each acquisition.




RE: EA's new slogan should be.
By AlphaVirus on 3/13/2008 5:30:41 PM , Rating: 3
quote:
I saw what they did to Westwood, (Command and Conquers series) and just shook my head. Not to mention the sports games seem to somehow get worse every year.

I watched both of these gaming segments fail also the famed Sim City series. I loved the Sim City titles but once EA took the reins, I became a sad sad gamer. Command and Conquer was a great game also, sad to see it go the way it is. I still play Red Alert: Yuri's Revenge for old times sake.

The good thing is
quote:
Some of the original Westwood developer team remained at EA Los Angeles, but most left to form Petroglyph Games.

http://en.wikipedia.org/wiki/Petroglyph_Games
March 25th they have a game "Universe at War" for XBOX360


RE: EA's new slogan should be.
By christojojo on 3/13/2008 6:05:19 PM , Rating: 2
I wonder what Take Two's future ex-developers will call their new company(s)?


RE: EA's new slogan should be.
By Omega215D on 3/14/2008 1:49:46 AM , Rating: 3
EA: Take Two, or EA 2, or EAT.

And eventually their HQ will look like a Borg Cube.


RE: EA's new slogan should be.
By dflynchimp on 3/14/2008 9:19:02 AM , Rating: 2
"Resistance is futile"

luckily in that particular situation things turned out otherwise....


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